The world's largest steel market in China fell all last week amid uncertain prospects, weak commodity prices, high inventories and overproduction of steel products .
On March 14, 2014, hot rolled coils with a thickness of 4.5-12 mm were sold in Shanghai for 3.330-3.350 yuan ($ 543-546) per ton. Prices fell 50-60 yuan ($ 8-10) this week. On Thursday, the day before, in Beijing, the price for the same product was from 3,230 to 3,240 yuan ($ 526-528) per ton, which is 40-50 yuan ($ 7-8) lower than a week ago.
But what is the reason for such low prices in China? China has long held the position of the lowest cost prices for coal, coke, and scrap metal. Iron ore is also no exception, but unlike coke, which China produces on its own, only half of the iron ore is mined in China, the rest is imported.
The second important factor is cheap labor in China. So until recently, according to statistics from Metals Consulting International Limited, metallurgical enterprises in China were ready to pay their workers $ 1.1 per hour. In Russia this indicator was $ 2.2 in the USA - $ 23.8. Also, Chinese metallurgical companies are engaged in an active policy of mergers and acquisitions, which allows them to keep prices at a certain level, and at the same time develop slowly but surely.
Steel prices in China fall for the second week in a row
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Azovpromstal® 16 March 2014 г. 16:34 |
