Chinese Steel Industry losing some of its competitive edge: MEPS
Steel News | 2012-05-15 12:13:28
After seeing ex-mill steel prices peak in April 2011, China has seen a steady decline that is cutting into the price advantage the country once held over other countries, said a UK based steel consultancy MEPS International in a research note on Tuesday.
By Paul Ploumis
LONDON (Scrap Monster): After seeing ex-mill steel prices peak in April 2011, China has seen a steady decline that is cutting into the price advantage the country once held over other countries, said a UK based steel consultancy MEPS International in a research note on Tuesday.
MEPS continued that, “The price reductions in China, however, have been less than those in other parts of the world. As a result, the Chinese steel producers have lost some of the price advantage that they enjoyed in spring last year.”
North America saw a price drop of $154 per metric ton, or 15.2%, over the 12-month period. The European Union saw a drop of $114 per metric ton, or 12.4%, and Asia excluding China saw a drop of $68 per metric ton, or 8%. China saw a price drop of $39 per metric ton, or 6.3%, MEPS added.
“A flight from China by Western manufacturers is unlikely but, if the current steel price margins persist, they may give further consideration to the advantages of moving their manufacturing units in the future,” MEPS said.
MEPS said that only a reduction in iron ore and coking coal costs could encourage the mills to make further substantial price reductions would affect Chinese mills further.
