All the world’s steel markets are being affected by the upsurge in Chinese exports that has taken place over the last two years.
Taking statistics for carbon steel finished rolled products (omitting stainless and alloy steels, as well as semi-finished products in all qualities), China’s exports surged from 10.5 million tonnes in 2004 to a likely total of more than 30 million this year. Over the same period, imports dropped from around 25.5 million to a probable 16 million tonnes in 2006.
In 2004, all regions except America were net exporters to China. In 2006, all except Eastern Europe will be net importers from China.
Our analysis shows a varying impact according to region and according to product. The biggest effect has been seen in the nearby markets of Asia. In 2004 the rest of Asia had a 9.7 million tonne positive trade balance with China. But this year the Asian countries will be net importers of approximately 4.6 million tonnes of Chinese steel.
The European Union was also a net exporter to China in 2004. But this year the EU will have a negative trade balance projected at 4.8 million tonnes. America had a small steel trade deficit with China in 2004 – less than 0.5 million tonnes – and this year that has ballooned to over 4.4 million tonnes.
Link to full story at MEPS STEEL NEWS
There has been a certain inevitability to this as Chinese steel production has exploded over the last few years. Ironically Chinese steel demand has contributed significantly to high steel prices over the past two years, yet it's exports may well now hold back or even bring about price reductions.
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