China's stainless steel import price drops

China’s stainless steel import price drops

Due in part to the overall dampening of steel prices in the Chinese market, China's CFR import price for 304 series stainless steel has dropped from $2'700/ton to between $2'400-2'500/ton. Traders have attributed the dropping price to the following reasons: 1. Starting from May 6, 2005, South Korea's POSCO lowered its HR stainless steel sheet price by won 300'000/ton ($300/ton). Many believe that the appreciation of the won was a major force behind POSCO's price modification. 2. China's stainless steel manufacturers have not been firm in their production cut, leading to surplus inventory levels. The current stagnant market conditions and the rising prices of nickel have prompted Japanese steelmakers to cut back on stainless steel exports to China since it is difficult for them to turn a profit. While the price of nickel-based stainless steel is declining, that of chrome-based stainless steel has been quite stable. CFR prices for chrome-based stainless continues to hover around $1'450-1'500/ton. 3. In Europe, stainless steel inventory has exceeded consumption for more than three months, thus European stainless steel plants plan to cut production and carry out periodical equipment overhauling ahead of time. At the moment, the 304 CFR export price from Europe to Asia is $2400/ton.