Michelle Applebaum, managing partner at Chicago-based Steel Market Intelligence, comments on the Chinese and Asian market for the metal in an e-mailed note yesterday.
“While Chinese pricing has shown surprising strength in the face of new record-breaking production levels - and slowing economic growth - we’re seeing signs of cracks in the ‘Chinese wall’ of pricing, with meaningful weakness now showing up in East Asia and Japan, where we saw an unprecedented 11 price cuts last week and zero increases.
‘‘While overall Chinese steel exports were up 17 percent through April, we suspect that the weaker pricing in China’s neighborhood is a result of a larger increase in Chinese exports in May, which won’t be reported for another week.
‘‘The Chinese market worries us for another reason besides exports as we’re concerned Chinese steel buyers are building inventories ahead of well-publicized power-driven summer production cuts.”
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