Steel strip prices are likely to fall during 2006 according to the latest MEPS forecast. EU mills have been unsuccessful in implementing price increases in quarter one, despite production cuts implemented during 2005. The gap between prices in the EU and US compared to prices in Asia continues to widen which will inevitably lead to increased pressure on suppliers to make modest price cuts to stave off imports.
Whilst demand in China, which contributed to high price rises at the end of 2004 is expected to continue growing, Chinese steelmaking capacity has increases beyond internal demand causing fears in Taiwan of Chinese exports undermining prices.
Steel prices in India are forecast to remain stable in the face of growing demand and a 25% fall from April 2005, it was feared that further price cuts were possible.