Steel prices surging in 2021

According to a report by S&P Global Platts, steel prices across the globe have reached their highest level since 2008 due to coil shortage in Europe and US and thus attracting the exports from Asian mills. The situation could be changed only if steel production lifts up in second half of 2021, implying that export opportunities will prevail in Q2 2021.

Hot-rolled coil prices have increased by 33% in US since the beginning of 2021, while by 36.5% in north European. China’s involvement in the export market has increased in the current year on the back of rising demand and price recovery in international markets. According to the report, finished steel exports increased by 24% year over year (yoy) in China over January-March, reaching 17.682 million mt. 

One factor which could be responsible for surge in China’s March steel exports is its move to reduce or eliminate the export rebates on steel by April. Still rising international prices are expected to keep the Chinese steel products competitive.

India continues to be a significant part of international steel market with its steel exports during April-February ‘ 2021  rising by 49.5% yoy. In the current year, India has largely switched its focus to supply steel to Europe. With tighter steel production in the country, the Indian HRC prices are expected to keep increasing until April-May.

In countries other than China crude steel production has been slow to revive post lockdown. According to the World Steel Association, Europe’s production fell by 7.1% yoy in March, North America’s by 8.9% and India’s by 8.6%.