STEEL PRICE RISE IN EMERGING MARKETS
DESPITE LOW SEASONAL TRADING
According to MEPS,
Brazilian stockists remain adamant that any move by domestic suppliers to pursue
price growth would be counterproductive and stifle what little buying interest
exists. Most consignments are small bundles. Strict lending conditions and
shrinking credit facilities are negatively affecting trade.
The outlook for demand in the Russian Federation is unchanged. Underlying
consumption for finished steel products fell short of industry projections –
particularly, from construction firms and pipe fabricators. The situation has
been exacerbated by the aggressive pricing positions adopted by domestic
steelmakers. Despite this, distributors plans to persevere with conservative
inventory levels over the winter trading period.
Activity remained subdued, in India, in early December. Traders intend to
tightly control inventory levels due to limited buying activity. Construction
firms continue to be hampered by working capital problems – a consequence of the
government’s currency demonetisation policy. However, this has not deterred
local producers from lifting their domestic finished steel offers. Third country
imports are in short supply.
Purchasing activity continues to be limited in Ukraine. Distributors report that
trading remains light for both the number of bookings and volumes transacted.
Tight lending conditions have squeezed investment in construction and
The Turkish finished steel market shows no signs of a substantial improvement
amid weak demand. Producers, operating EAF steelmaking facilities, responded to
the escalating cost of ferrous scrap with caution. They highlight the volatile
nature of the global scrap markets – with peaks, quickly followed by significant
The business climate remains tough in the United Arab Emirates. Local
construction firms are unwilling to purchase more steel than they need to meet
their near-term requirements. Emirati rolling mills opted to raise their selling
figures to offset higher production costs.
Procurement activity in South Africa is forecast to deteriorate further, ahead
of the festive holidays. Local distributors plan to persevere with conservative
inventory levels in the short term.
The trading environment remains challenging in Mexico. Flat product dealers are
holding off purchasing until January to see how demand develops, citing both
tepid end-user consumption and the strength of the US dollar against the Mexican
Source: MEPS -
Steel Review - December Edition
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