Global Steel Prices Stabilise Amid
The consensus view of global steel market participants is that
they are uncertain about the future direction of domestic pricing.
At this time of year, US and European flat and long product prices would be
expected to weaken, as market activity slows down, during the summer holiday
period. The implementation of trade legislation has given US and European
producers the opportunity to counter the traditional seasonal price trend.
In response to Section 232 tariffs, introduced in the United States, the
European Commission recently announced provisional safeguarding measures on
steel imports. The introduction of tariff rate quotas on 23 types of steel is
aimed at preventing material, which has been redirected from the US, from
entering the region.
MEPS’ research, in August, indicates that European steelmakers are already
aiming to capitalise on the supply uncertainty, by raising their offers for
fourth trimester business to EU customers. Firm demand
and a lack of competitively priced imports should support
their pricing initiatives.
In the United States, local selling values have been maintained at elevated
levels, despite the reduction in demand, during the summer months. This is due
to the high level of trade protection currently afforded to US steelmakers. The
dearth of import competition, notably from neighbouring Canada and Mexico, has
strengthened the selling position of local producers.
Subsequently, US and European steelmakers have, generally, been able to stave
off the threat of losing, in the summer lull, a proportion of the pricing gains
achieved in the first half of 2018.
MEPS - International
Steel Review - August 2018 Edition
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