Steel prices advance as monsoon seems over in China, auto sales accelerate

Steel prices have advanced as the monsoon season is about to over in most provinces of China, and the demand will recover soon. The resumption of construction activities for real estate and infrastructure will bring a revival in demand for steel, and the corresponding prices may accelerate further.

Production of steel in China has remained vulnerable after the announcement of an export duty of 15% on selected pig iron, flat-rolled products of iron or non-alloyed steel, bars and rods, and various flat-rolled products of stainless steel, as per The Hindu. The steel export market in China has witnessed a severe slump after the sanctioning of export duty and the pledge to save the environment from the harmful effects of steel production.  

Meanwhile, Russia plans to escalate steel exports at lower prices to cater to a large market in Asia. However, the payment mechanism will remain critical as the US abandoned Russia from the SWIFT payment mechanism after it invaded Ukraine. Russia is providing attractive discounts to address the mass market of Asia, which might force China to sum up its export duty levied on steel.