The Hindu Business Line : `Steel prices likely to go up in Q4'

According to Mr Patrick Flockhart, Managing Director at Steel Biz Briefing, a bit of weakness is coming out of the former CIS countries such as Russia and Ukraine.

Western Europe is still very strong and it looks like there are going to be some further price rise coming in through Q4 that is for the period of October till December, he adds.

There are lots of exports coming out of China for the first time but as of now they are not significantly impacting the price situation, he further adds.

After looking at what Baosteel said today, do you expect softness in the steel market globally?

We haven't exactly seen what Baosteel has said but at the moment there is a bit of weakness in China for domestic price scene and also for export prices. We are also seeing a bit of weakness coming out of the former CIS countries like Russia and Ukraine.

Western Europe is still very strong and it looks like there are going to be some further price rise coming in through Q4 that is for the period of October till December.

In the eastern part of the world, in China and Russia there is a weakness but generally speaking in the advance economies the steel cycle are still pretty solid.

It might be that we are heading for an overall top of the cycle in Q4. But in Q1, we will probably be off the top of that cycle but the general view at the moment is that the prices will not be going down significantly in Western Europe and US if at all. They are bit of a mixed bag and are perhaps showing the regional nature of the worldwide steel business.

A lot of people were worried about lot of exports coming out of China potentially having a disruptive effect on the US and Western Europe. There are lots of exports coming out of China for the first time but as of now they are not significantly impacting the price situation. So, quite a varied picture there I am afraid but very interesting too.

What are average levels at which you find prices now in the US, Europe and China?

The US price according to the US Steel Index last week was $648 for a short-term and the European price was about 485 per tonne last week and these are the European and the American domestic prices.

The European price is a metric price. Prices coming out of places such as Ukraine etc at the moment are probably in the order of round about $500 base price.