Depending on which market one looks at, prices of coated steels have either risen, fallen or remained roughly the same since mid-May. One crucial impact of the Covid-19 pandemic that has swept the world this year is the decoupling it appears to have created between global steel markets.
In China, prices of most steel products, including coated steels, have continued to increase in recent weeks. They have been heading up from the lows reached during late April/early May and since then, prices of hot-dipped galvanized (HDG) in the country (both for domestic and export sales) have risen by around 10%. Certainly the economic data that continues to emerge from China shows it as the major economy that has so far seen the biggest rebound in activity following the pandemic-related slump back in February/March. As the origin of the pandemic and the first country to be affected this is understandable. European and US steelmakers will be hoping that the pattern eventually repeats itself in their markets.
For now, US steelmakers appear to be enjoying better conditions than their counterparts in Europe, even though it could be argued that the pandemic now appears to be affecting the United States more than the European Union. Steel prices are relatively stable month-on-month in the US although the recent spike in viral cases there and moves back toward lockdown and/or quarantine measures are likely to see activity take a hit in the short term at least. A retreat in prices cannot be ruled out.
In Europe, steelmakers will be hoping that the worst has now passed in their markets. Steel prices have continued to fall since mid-May but appear to have stabilized over the past couple of weeks. Economic activity is picking up and steel prices are relatively competitive when compared to those in other markets. Such conditions mean that European steelmakers should be the ones to benefit from any pick-up in demand over the coming weeks, even though import quotas for the region will reset in July.
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