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Baosteel raises steel prices for the second consecutive time Iron ore prices push new highs in recent years

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Source: China Market Research Online Author: Market researcher
Baosteel, the leading domestic steel company, announced on October 13 its policy for ex-factory prices for mainstream products in October, including a general increase of RMB 60/t for hot-rolled steel and RMB 50--100/t for cold-rolled steel. This is the second time since August this year that Baosteel has raised steel prices for the second consecutive time.
In general, “Jin 9 Silver Ten” is the peak season for the consumption of steel products, and the major steel mills will see improvement in their orders in these two months. But so far, this year's "Golden September" feature has not performed clearly. As a capital-intensive industry, high financing costs have a certain inhibitory effect on the demand for steel terminal and the release of intermediate demand.
In the case that the fundamentals of supply and demand are not optimistic, the important factor supporting the price increase of steel mills is the continuous rise in the prices of raw materials such as iron ore and coke. Iron ore, in particular, has risen for four weeks since mid-August. The current market price has reached 187-189 US$/ton, which is only one step away from the high of US$190/ton that was created in April this year.
“The current low inventory and high cost have a supporting role to steel prices, but the tight funding and negative external macro environment will bring certain uncertainty to the steel price trend. It is expected that the overall steel price will be dominated by box vibration in the later period.” Qiu Yuecheng, an analyst at the well-known steel spot trading platform “Nishimoto Shinkansen” believes. There are also insiders pointed out that the final price of raw materials still depends on downstream demand. If the price of iron ore is changed, it is not ruled out that steel prices will begin a new round of adjustment. (Reporter He Xinrong)