Although credit squeeze is taking its toll on Chinese demand for metals, pricing announcements by Chinese steel majors point to expectation of buoyancy after Lunar Holidays.
It is reported that an unpublicized directive released on February 12th morning, Baosteel, the top China steelmaker, unveiled its price change details for productions of March 2010 with prices of HRC and CRC both elevated by CNY 300 per tonne. This is a strong signal of market scenario for flats post Lunar Holidays.
Although some Chinese analysts have given positive queues for long products also, but it is difficult to outline likely scenario as demand for construction material has remained subdued and may not look up even after post holidays.
It appears that the trend this year is going to be different than last year when after opening on firmer note, post Lunar Holidays, prices of both long and flat products went on to decrease substantially till mid May 2009.
The Chinese Long Product Price Index CLPPI lost 8 points last week whereas the Chinese Flat Products Index CFPPI lost 7 points. The overall price index CHISPI decreased by 8 points.
[Steel Guru]
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