SHANGHAI, Oct. 14 (SMM) -- According to latest data from China Customs, China’s exports of finished steel were 4.21 million mt during September, up 20,000 mt or 0.48% MoM, and up 39.9% YoY. Imports of finished steel were 1.33 million mt, down 20,000 mt MoM, but up 0.8% YoY.
Global demand for finished steel remained weak due to a global economic slowdown and lingering European debt crisis, causing China’s exports of finished steel to remain weak. Steelease predicts China’s steel exports will continue to fall during October.
First, the European debt crisis still continues and has risk of further deteriorating, and the unemployment rate in the US remains high, leaving the high possibility of a global economic slowdown. In addition, the emerging economies have to tighten monetary policy due to high inflation, resulting in slower growth of the manufacturing sector, which slows the growth of international steel demand. The growth of manufacturing sector in major destinations of China’s steel exports like South Korea, the European Union (EU) and India has fallen continuously. The EU’s and South Korea's manufacturing PMI in September were 48.5% and 47.5%, respectively, down MoM, while India’s manufacturing PMI in September was 50.4%, hitting a 2-year low.
Second, Chinese RMB continues to appreciate, and has recently reached 6.35 against the US dollar, making China's exports of steel products less advantageous compared to the Commonwealth of Independent States (CIS) and other countries.
In summary, Steelease expects China’s steel exports to fall slightly during October.