SteelOrbis Shanghai
According to data from Chinese customs, imports of cold rolled non-oriented silicon steel from January to June in 2007 reached 398,700 metric tons, up 13.16 percent on the same period last year. The main reasons for this increase are as follows:
Firstly, the ex-factory prices of low grade cold rolled non-oriented silicon steel produced by domestic mills have increased by approximately RMB 1,000/mt ($132/mt). As a result, the difference between domestic ex-factory prices and external prices has become smaller. The domestic prices of some specifications of cold rolled non-oriented silicon steel were even higher than the international prices of the same specifications. For this reason, many end-users began to reduce their purchases of domestic cold rolled silicon steel and opted to buy imported silicon steel instead.
Secondly, the RMB exchange rate has increased seven percent compared with two years ago. Thus, the RMB prices of imported silicon steel have seen a corresponding decrease.
Thirdly, the exports of cold rolled non-oriented silicon steel in the first six months of 2007 came to only 98,800 metric tons, down 14.05 percent compared with the same period of last year. This is evidence that the price advantage of domestic cold rolled non-oriented silicon steel is shrinking.
To sum up, the increased imports and reduced exports of cold rolled non-oriented silicon steel will have an influence on the market trend of cold rolled non-oriented silicon steel in China.