Chinese medium plate prices move steadily up

SteelOrbis Shanghai Boosted by the rising sheet prices, China's medium plate market saw a better performance over the past week. On December 27, the average price of 20 mm Q235 B in Shanghai, Tianjin and Lecong was up RMB 37/mt ($ 5/mt) to RMB 3,630/mt ($ 464/mt), while that of 20 mm Q345 B was up RMB 20/mt ($ 3/mt) to RMB 3,710/mt ($ 474) week on week. The steady market movement last week mainly resulted from the following factors: 1. The price increase of other varieties pushed up medium plate prices. In the past, the market trend of medium plate usually lagged behind that of the sheet market. Therefore, influenced by the brisk market performance in the HR and CR markets, medium plate prices followed and saw steady upward movement throughout the past week. 2. Some mills hiked their prices. Yingkou has just hiked its settlement prices for December. The ex-factory price of 12 mm plate increased RMB 150/mt ($ 19/mt) to RMB 3,700/mt ($ 473/mt), while that of 14-25 mm common carbon plate increased RMB 100/mt ($ 13/mt) to RMB 3,650/mt ($ 467/mt). After this adjustment, the total costs of the distributors are above the current market price level, not to mention the average price level in December. Thus, the distributors raised their prices in order to avoid losing money in such an upward market. Futhermore, Shougang, Xiantan Steel, and other mills also hiked their ex-factory prices by RMB 50-100/mt ($ 13/mt). 3. Medium plate in short supply recently. With regards to the market inventory, the situation last week is almost the same as in past weeks. It is expected that northern supplies will arrive in the eastern and southern markets next week, which may cause temporary price fluctuations across the market. As regards imports and exports, the good performance levels in exports continued during the week. It is reported that South Korea is to increase its shipbuilding plate imports from China in 2007 – a further indication of the rising position of China's shipbuilding plate in the international market. Naturally, the good situation as regards exports strongly supports the domestic medium plate prices. For the next week, the ex-factory prices of the steel mills and the northern supplies will be the decisive factors affecting market prices. Generally speaking, the market is unlikely to see large fluctuations.