Analysts are forecasting an end to the recent rise in carbon steel prices,
amid whispers of potential over-supply in the steel industry. One source
close to a UK-based steel major told Platts: "Some product supplies are
tight, and some easing: for merchant bar, there is no shortage, but sections
are tight, while HR and CR coil, and galvanised, have eased off
significantly."

According to data from the International Iron and Steel Institute, world
crude steel production for the 62 countries reporting to the International
Iron and Steel Institute was 101.6 million tonnes in August, up 11.0 per
cent on a year-to-date basis. China produced 36.7 million tonnes of crude
steel in August, an increase of 17.0 per cent compared to August 2005.

And according to Graham Wailes, principal coal analyst at AME Mineral
Economics, steel production in China is forecast to see compound annual
growth of 7.3 per cent from 2005 to 2010.
Export and import trade figures are also up, according to ISSB estimates.
The Institute estimates that the US imported 20.1 million tonnes of steel
mill products for H1 2006, up 35 per cent from the 14.2 million tonnes
recorded in the year-on-year period.

EU25 H1 2006 imports were estimated at 16.6 million tonnes, up 6 per cent
from the 15.6 million tonnes recorded in the first half of 2005. Conversely,
China's imports for the first half of 2006 fell year-on-year by 32 per cent
to 9.4 million tonnes. And in terms of exports, the ISSB says China led the
way for H1 2006, with a total of 18.9 million tonnes of steel mill products,
up 22 per cent from H1 2005.

EU25 exports were up 5 per cent year-on-year to 16.9 million tonnes, while
Japan was ranked third, with an estimated total of 16.6 million tonnes
exported, although this was down by 1 per cent year-on-year.
In the latest Societe Generale quarterly commodities review, the firm
suggested: "The key question is whether the steel industry is heading for a
repetition of H2 2005's soft market conditions or a more pronounced
downturn.

Against a backdrop of rising supply response, we doubt whether the steel
industry can preserve the record high returns of 2004-06 and we expect signs
of negative pricing momentum and declining returns in the coming quarters."

A spokesman for Eurofer told Platts that he agreed prices were stabilising
in Europe. "August and September prices in Western Europe were the same for
normal steel products, and for galvanised," he said.

SocGen suggested that prices for HRC were steady, holding at around
$640/tonne, which was confirmed by a trader in southern Europe: "The last
price I got for HRC was around €500 ($635)/tonne FOB for European-sourced
material." The trader added that suppliers were not expecting any further
significant price increases until the end of the year.

So an easing in demand is very possible, with seasonal slowdown in the US
and EU, an end to restocking and a slowdown in real demand. Looking ahead,
SocGen suggested: "We continue to expect prices to slip from Q3 2006 onwards
as supply constraints ease both in the US and the EU and import pressure
continues unabated."

interesting data, i doubt it prices will remain stable , they might move up with increase in demand, as long as there is not easily available alternative metal found.

__________________
Trade Mumbai
Buy & Sell property in mumbai

This data was about the end of the year 2006, I wonder about the data now... What could be the possible changes in data this year? Is steel a good investment or is it not advisable? Anyone care enlighten me? Thanks in advance and good day.

__________________
Christian Dinopol
learning Import/Export
http://www.import-mentor.co.uk/