UK based MEPS said that in China, average provincial billet transaction values declined by 3.8% in July 2012. Market sentiment has been unsettled by the downtrend in finished steel prices and a slump in the cost of raw materials, particularly, iron ore and ferrous scrap.
The business climate has deteriorated in India. Billet trading volumes are expected to remain subdued in the August and September 2012 period, weighed down by sluggish seasonal construction activity. Downward price pressure is also being exerted from a fall in input cost pressures particularly, ingots and ferrous scrap material.
CIS steelmakers remain bearish over the export transaction values in the near term. Most have scheduled maintenance work for the summer months. Tonnages designated for overseas sales remain limited as a result. CIS traders, operating in Black Sea and Caspian Sea ports, are reluctant issue lower billet quotations, since they realize that reductions will not stimulate buying activity.
Price sentiment has not improved in Turkey. Domestic billet producers are faced with a dilemma of whether to ride out the difficult trading conditions or downgrade planned production targets. Most do not expect to witness a significant price recovery in the August and September 2012 period.
The business environment remains challenging in the United Arab Emirates, in view of the persistently weak market for finished steel products and the close proximity of the summer holiday season and Ramadan. Market participants are desperate to avoid the problems that were a hallmark of the 2008-09 economic crisis.
Difficult trading conditions persist in Taiwan. Steel demand from the construction sector has fallen short of industry expectations. The price differential between domestic and imported scrap is unchanged at USD 15 per tonne. Foreign suppliers are reluctant to offer further concessions, fearing such measures would be counterproductive and only fuel more price instability.