Downward pressure seen in Argentina’s flat steel market

Friday, 04 December 2015 00:59:04 (GMT+3)   |   Sao Paulo
       

A source close to a major service center in Argentina said that despite the enthusiasm and optimism seen in the domestic steel market, a price increase for flats is unlikely to happen.

“We’ve been hearing no rumors of price hikes so far [for flats]. Actually, I see the opposite, I see a pressure for prices to decline.”

A trader explained a few local producers control most of the domestic market. “Siderar produces CRC, HRC, tubes, and both galvanized and repainted steel. So, you have a group that produces about five or six product lines. I can import those products and earn about $200/mt, but if I do that, I’m going to end having no supplier of HRC, CRC, tubes, galvanized and pre-painted steel in the domestic market,” said one Buenos Aires-based trader.

“I think Argentina needs to open itself to imports,” he added.

A source said Siderar is currently selling HRC in the domestic market for ARS 8,237-8,721/mt ($850-$900/mt) FOB, depending of the size of the orders.

Despite uncertainty in steel prices, with Acerbrag seeing positive fundamentals for a price increase in longs, and despite other sources seeing no room for an increase in flats, sources agree positive changes will come to Argentina’s steel market.

USD = ARS 9.69 (December 3)

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