Import prices for flat-rolled steel went up in South America during the week ended Friday March 26, with resilient demand but China out of the export market, leaving only higher priced material from traders and Japanese mills to be bought.
The vast majority of Chinese steelmakers decided to hold back from the market since their government had not yet decided on a cut in the export tax rebate for steel products. Market participants expected a resolution of the matter to be announced soon, to take effect on April 10.
Three market participants told Fastmarkets the most recent expectation was for the rebate on hot-rolled coil and heavy plate to reduced to zero from 13%. The cold-rolled coil rebate would be lowered to 9%, but that for coated steel would remain at 13%.
One more factor preventing deals from being settled and increasing prices materially was freight. Market participants have seen a
$20-30 per tonne rise in freight rates from China to South America in the past two weeks, even though costs had already jumped in late February.