In 2020, Chinese Iron & Steel market has been rising slowly, but last weekend, the market price has been rising quickly.
To be honest, as a supplier, we are even getting afraid of sending quotation to our foreign clients.
What is the reason? After reading below article, maybe you could understand.
--1. Materials increased 180 RMB November 1- 30, but increased 230 RMB Dec 2- 7( just 7 days ) totally is 410RMB =$63/T.
This mainly due to the Iron ore prices rise the Plates price for 62% increased $119.05/T to 145.30/T almost 22%;
--2. The shipping freight increasing:
Shipping company raising prices deliberately (click this link for further detailes: Sea freight going crazily recently)
For example, Qingdao, China --Jakarta, Indonesia, the price was $200/ 20 GP (last year), now up to $2000/ 20 GP.
We used $8/T to calculate the freight, now we have to use $80/T, this part is $72/T;
--3. The USD Exchange rate have down $1=RMB 6.8002 (in Sep.) TO $1=RMB 6.50 (in Nov.)
What risks we still need to face are:
--1. Freight maybe keep increasing befofre COVID-19 under control till vaccine licensed post marketing.
--2. Some bank analyst in China abroad such like JP Morgan predicated that USD rate maybe down to US$6.30 lower...
Winter is coming, how will Chinese Iron & Steel market be? Let's wait see.
But we must keep hope in our heart, like Shelley saying: When winter comes, can spring be far behind?