High-end Steel Prices Advance

The prices of grain-oriented silicon steel across China have rallied with other medium- and high-end steel products such as auto steel, bearing steel and stainless steel expected to follow suit. The massive earthquake has caused closures of many steel workshops in Japan, a major source of silicon steel and other high-grade materials for the Chinese market. This gap will likely be filled by Baosteel and Wuhan Steel, the latter of which has announced high-tech GO silicon steel ex-works price hikes by 1,000 to 1,200 yuan a ton for April deliveries.

The domestic construction steel market also reacted by returning to stabilization on the expectation of firmer demand from the post-quake reconstruction in Japan. Demand for iron ore is expected to shrink remarkably in the short term and the prices will face greater downward pressure.