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Prices of major steel products are skyrocketing
Prices of major steel products are skyrocketing

20 September 2022 – Steel prices in South Korea have soared since Typhoon Hinnamnor. In some cases by more than 16% within just a few days. In China, the coming peak season in the construction sector is already looming over steel demand. Other countries announce planned steel price increases. At the same time, prices for steel and stainless steel raw materials continue to rise.

South Korea: Prices of major steel products are skyrocketing

Production losses at South Korea’s largest steel and stainless steel producer due to damage from Typhoon Hinnamnor have caused South Korean steel and stainless steel prices to skyrocket. Stainless steel production seems to have been hit particularly hard, driving concerns about availability, according to media reports.

Local prices for key steel products have already shot up by more than 10% compared to the previous month. Import prices have even increased by more than 16%.

Demand: Chinese peak season ahead

Experience shows that demand for steel in China’s construction sector will pick up significantly as the rainy season begins to wane in September. Rating agencies such as Fitch also see it this way and currently predict that rising prices are to be expected. At the same time, various quarantine measures have been lifted in China, which should also contribute to rising demand.

Thai steel prices to rise

Thai steel producers are planning to raise prices strongly. This is due to higher operating costs, higher raw material prices, rising energy costs and higher minimum wages. Rising prices are also reported from other parts of the world, such as Turkey, at the same time.

Iron ore, ferrochrome: raw material prices rise

The prices for important raw materials in steel and stainless steel production have recently shown an upward trend.

Iron ore rises

Iron ore rose after Chinese economic indicators suggested that government stimulus measures are boosting the construction industry, which should translate into stronger demand for construction material.

Higher production and falling rebar inventories show that Beijing’s efforts to boost construction are having a positive impact.

Ferrochrome in short supply

And production cuts at high-carbon ferrochrome producers in China’s Inner Mongolia are also having an effect.

Most of the operating ferrochrome plants maintained only limited production to supply long-term orders, resulting in tight availability on the spot market. In addition, prices for chrome ore have risen recently, so the high-priced raw materials also supported the ferrochrome plants in terms of costs, allowing them to maintain their prices. Stainless steel prices have continued to rise recently, which is now also having an impact on the ferrochrome market.

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