South Korean steelmakers mull to reschedule maintenance activities as they ramp daily capacity utilization to cater to the growing domestic steel demand. Production volumes have increased amid rising steel demand in the domestic as well as overseas markets. Most carmakers, shipbuilders and other industrial steel consumer sectors are operating at full throttle, said Davis Index sources.
Post-Chinese New Year holidays, global steel prices have remained high. Despite high inventories Chinese mills are not exporting in anticipation of strong domestic construction demand. While South Korea’s government has announced a plan to increase the number of new homes by 836,000 in the next four years, which could support demand for reinforcing bars and other steel products used in construction. Amid these positive sentiments, mills in South Korea have increased ferrous scrap restocking, resuming bulk purchases from the US, Japan and Australia.
Prices for iron ore and ferrous scrap remained bullish with benchmark Australian 62pc Fe content ore trading at $172-175/mt cfr Qingdao and imported bulk HMS 1&2 (80:20) from the US reaching $450-455/mt cfr Turkey levels.
Major steelmakers Posco, Hyundai are mulling to reschedule their repair activities at steel plants. Posco decided to postpone repair work on a cold-rolled steel plant in Gwangyang until April, earlier schedule for March 8-13. Hyundai Steel has been operating at normal rates and postponed its repair schedule until the end of the financial year.
Finished flat prices soar
Finished steel prices have increased on high raw material prices. For March deliveries, Posco could raise HRC prices by KRW50,000/mt ($44.96/mt). The earlier price hikes have been absorbed by the market. Prices were hiked by KRW80,000/mt in January and KRW100,000/mt in February. Hyundai Steel is also expected to raise HRC prices by KRW50,000/mt in March.