China wants to monitor the commodity market more closely and intervene in a regulatory capacity where necessary to ensure greater stability and security of supply. In the United States, metalformers are complaining about increasingly long lead times for steel products. Steel prices down last week in China – without impact on current week.
Chinese State Council wants to regulate commodity prices more strongly
China: On May 25, 2021, the Chinese State Council adopted an action plan for the period of the 14th Five-Year Plan, which envisages a comprehensive reform of the price mechanism in China and is intended to pay attention to the goal of “carbon peak and carbon neutrality”.
A focus is to be placed on bulk commodities, such as iron ore, copper, crude oil, natural gas, corn and soybeans. To monitor this, an early warning system is to be created that observes all important market factors. And to react with appropriate control measures, such as imports or exports, tax adjustments and the creation of reserves, should there be unusually sharp swings in the market.
The overall aim is to ensure that supplies are secured and prices are kept stable.
US metalformers: Increasingly long lead times worry industry
According to a report by thefabricator.com, long lead times for steel and other metal products are dampening the outlook of metalformers in the United States. 71% of companies surveyed in May 2021 said lead times had continued to increase from the previous three months.
Long U.S. lead times: Steel imports help industry
S&P Global Platts also reports that lead times for domestic steel products in the United States remain at least double the 10-year average. Only lower lead times for steel imports have helped flatten the curve in recent months, it said.
Steel prices down last week in China – without impact on current week
Last week, prices for HRC steel fell in China. By contrast, no falling stainless steel prices were observed on the Chinese market.
Currently, purchasers outside China must be aware that the announced export tax on steel products has not yet been taken into account in the prices currently available. This may lead to a distorted perception of the overall price structure.
And news about price movements on Chinese steel products from the previous week cannot be used as a basis for the current week. At least that is our opinion when looking at the current data.
Rising prices from the United States and Europe also show that there is still no perceived easing in the supply situation for steel and stainless steel products.
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Disclaimer: Many things here represent our opinion. Others are information from the Internet. We can therefore never claim to be correct or complete. And never base a business decision solely on the news you receive from us.