Baosteel increases plate prices for March
SteelOrbis Shanghai
Baoshan Iron & Steel Company (
Baosteel) increased its heavy and medium
plate ex-factory prices for March 2006 deliveries.
According to the company's announcement on January 19 regarding the prices for forward transactions to be delivered in March 2006, the price of 10.1-50 mm structural steel and 10.1-15 mm
shipbuilding plate increased RMB 400/mt ($50). The new price for 15.1-50 mm thick and 2-4 meter long Q235 is RMB 3,500/mt ($434), tax excluded. The new prices are effective as of January 19, 2006.
Sources report that the price hike came because
Baosteel met some problems regarding its future
production. It is learnt that there's something wrong with
Baosteel's rolling machines, therefore, they raised prices by large amount against a possible decrease in their supply.
The price adjustment has little influence on domestic market prices because these products are generally sold to end users. Furthermore, compared to other similar products,
Baosteel's prices were still lower than Wuyang Steel. Both
Baosteel and Wuyang Steel have first class products.
Baosteel's current price adjustment will influence the exports.
China is actively engaging in exporting heavy plates to European countries and the volume exported to South
Korea shrank. South
Korea is now discussing the heavy
plate contract with
China, however, the quantity is unlikely to be set under the current market condition.
Thus, it's also difficult for South
Korea to purchase Chinese
shipbuilding plate, because current offers from
China for heavy plates are higher that those before. Offers from Nanjin Steel reach $410/mt CFR, while that from
Angang reach $440/mt.