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Asian steel market braces for South Korea, China influx once again-The 18th Guangzhou Die-casting, Foundry & Industry Furnace Exhibition
6/7/2017 Die-casting expo-foundry expo |
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Nikkei reported that steel market is growing cautious as South Korea ships out more cheap exports amid weak domestic demand and concern grows that China could do the same if its economy slows down. Exports are already pushing into the Japanese market. In late May, South Korea''s Hyundai Steel promoted its H-beam steel common building material and steel sheet pile to traders in Tokyo, offering the products for 10% cheaper than Japanese steelmakers'' official price.
H-beam exports from South Korea surpassed 30,000 tonnes in the January-March period, quadrupling from a year earlier. If the cheap exports continue, it could spoil Japanese producers'' opportunity to raise prices.
An adviser with SK Networks Japan, a trading company associated with Korean conglomerate SK Holdings said that "South Korean sales are weak and cheap exports from China are causing a pile-up.”
Leftover product from South Korea is now flowing into Japan.
China is also finding Japan an attractive market. As America and Europe slap anti-dumping tariffs on Chinese steel, the country''s steelmakers are turning their exports toward Southeast Asia. The region, however, is becoming less dependent on imports as local production comes online, such as a large blast furnace steelworks in Vietnam.
Wary Chinese steelmakers have already begun to make moves by targeting building materials, a field dominated by generic products. Shagang Group has obtained certification that its products meet Japanese industrial standards. The group may try to enter the market for hot-rolled steel sheet and other products.
Japanese general contractors are also turning their eye toward steel imports. These products come across as an even better deal as Japanese steelmakers like Nippon Steel & Sumitomo Metal continue to raise prices. Some general contractors and steel traders are helping Chinese steel mills improve their production technologies and are stepping up use of imported H-beams in construction.
Currently, steel demand in China is firm, and there is little impetus to boost exports even as production continues to reach record levels. Chinese steel mills are increasing production to lock in fatter margins amid falling raw material costs and rising product prices. If stimulus-induced demand loses steam, however, overproduction will become an issue. There is a high chance that Chinese steel exports will climb if demand weakens during the second half of the year once infrastructure investment begins to wane, according to an official at Australia''s Macquarie Capital.
-The
18th Guangzhou Die-casting, Foundry & Industry Furnace Exhibition
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