South Korea: Pickled, HGI sheet trade prices rise to $1,075/t amid supply crunch

Prices of pickled steel sheets and hot-rolled galvanised steel sheets in South Korea's domestic market are rising amid a supply crunch. Currently (as of March 29, 2022), market prices of pickled steel sheet coils, and hot-dipped galvanised steel sheet coils are trading in the mid-range of 1.3 million won/tonne (t) ($1,075/t).

Prices of pickled steel sheet coils were trading at around 1.1 million won/t ($910/t) and hot-dipped galvanised steel sheet coils at 1.2 million won/t ($993/t) in early March.

The price hike is expected on the back of the steep rise in distribution-level prices of pickled and hot-rolled galvanized steel sheets against production drop. Production of hot-rolled and galvanised sheets from domestic blast furnaces decreased in February by 18% compared to January.

Hyundai Steel's Dangjin 1 CR plant confirmed that the distributors are adjusting their inventory. POSCO is showing tight supply of hot-rolled galvanised steel sheets and the company's HGI domestic sales volumes in February decreased by 15% compared to January.

Outlook

As the end of the month approaches, manufacturers of pickled and HGI sheets are planning to raise prices in April, 2022.

"We have secured pickled and HGI quantities from Hyundai Steel in advance so that there will be no disruption in sales," said a cold-rolled distributor.

Another cold-rolled distributor said, "As demand has not yet recovered, currently, existing inventories of pickled and HGI are being sold at 1.3 million won/t but depending upon the the market conditions in April, we may run out of stock. Hence, we are controlling our sales."

Note: This insight has been published in accordance with an article exchange agreement between SteelMint and SteelDaily.