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Asia Steel Market: Mixed Signals Amidst Global HRC Fluctuations and CBAM Impact

Asia’s steel market presents a mixed outlook, influenced by global hot-rolled coil (HRC) dynamics and the EU’s Carbon Border Adjustment Mechanism (CBAM). The “The global market for hot-rolled coil has been growing steadily since early November” indicates a global upward trend in HRC prices, except in China, which contrasts with the European market’s CBAM-related uncertainty discussed in “EU coil buyers left scratching heads over CBAM” and “EU roll buyers were left wondering about CBAM“. No direct relationship between CBAM news and activity levels can be established based on the available information.

Bar chart and satellite map of steel production activity in Asia

The mean steel plant activity in Asia has seen a significant decrease, dropping from 37% in September to 23% in October.

Shandong Taishan Steel Group Co., Ltd., an integrated steel producer with a 5000 ttpa crude steel capacity, primarily producing hot-rolled and cold-rolled coil, has consistently operated below the Asian average. Its activity has steadily decreased from 17% in June to 13% in October, a decrease of roughly 24%, but is roughly stable in the last two months. No direct connection to the named news articles can be established.

Guangxi Beigang New Material Co., Ltd., which has a 3400 ttpa crude steel capacity using both BF and EAF technology to produce hot-rolled coil, cold-rolled coil, and other products, shows activity levels generally below the Asian average, with a notable drop from 28% in September to 23% in October. No direct connection to the named news articles can be established.

Habas Aliaga steel plant, a Turkish EAF-based steelmaker with a 4500 ttpa crude steel capacity and a focus on semi-finished and finished rolled products like hot-rolled coil, has consistently operated well above the Asian average, with activity hovering around 58-59%. No direct connection to the named news articles can be established.

Based on the current data, and given the reported rising global HRC prices outside of China coupled with the EU’s CBAM uncertainties, steel buyers should:

  • Closely monitor Turkish HRC offers, particularly from Habas Aliaga, as their activity remains high, offering a potentially stable supply source, especially if EU importers reduce their reliance on Asian markets with unclear CBAM implications.
  • Negotiate contracts with suppliers, particularly in regions impacted by CBAM, based on verified emissions data to avoid price fluctuations related to default CBAM values as highlighted in “EU coil buyers left scratching heads over CBAM” and “EU roll buyers were left wondering about CBAM“.