World crude steel production up 2.8% MoM; mixed trend in steel prices

Steel prices were mixed. Indian CR grade HRC declined 8% WoW and commodity grade steel was flat.

The Chinese steel market turned weak with HRC and long product prices falling 1.5-3% WoW.

Spot iron ore prices inched up US$2/t to US$198/t though volumes were thin and the market, weak. Swaps for 2QCY11 and 3QCY11 also declined 3-5%.

Global crude steel production increased 2.8% MoM to 119.4mt in January with capacity utilization rising to 75.6% (from 73%).

BHP's CEO expects growth in demand for commodities to slow in 2011 even as the near term outlook remains strong. BHP expects a slower but more sustainable economic growth model to lead to a reduction in resource intensity per unit of GDP. Absolute demand is expected to be strong and supply constraints in the copper, coal and iron-ore markets are expected to keep prices higher.

Source : Equity Bulls

Keywords