Both prices and quantity of semis exports drop

SteelOrbis Shanghai Rumors that the Chinese government will impose tariffs on semis exports put steel mills and traders in difficulty when quoting prices for exports, which also leads to a decline in the quantity of exports. According to the rumors in the market, the government will impose the tariff starting from either May 1 or June 1. However, the rate of the tariff is not clear yet. No matter whether the rumors are true or not, they are influential on both steelmakers and traders. Both steelmakers and traders are very prudent when doing business because they are facing the danger of not recovering the tariffs that might be imposed when selling at the current export price levels. Meanwhile, the semis prices in the CIS countries are slightly going down; therefore, the competitive force of Chinese semis products dropped. Currently, export offers for common carbons at Tianjin Port are at $375-380/mt FOB level. The unfavorable export condition greatly pressured the domestic market. Prices in major semis markets such as northern, northeastern and eastern China dropped slightly. It is also worth noting that the decline in strip steel prices affected the sales of common carbon billet. Therefore, many semis producers in Tangshan started producing 20MnSi, bringing new pressures on the already weak market. Prices in the CIS countries and European markets are currently strong, but they may decline in the following months. If the prices there finally go down, then the domestic Chinese semis market will also record price declines, because the export condition is the chief factor that supports current domestic prices.