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Monthly analytical report

Issue 10 (44), October, 2010

Contents
Long products . . . . . . . . . . . . . 2 Billet . . . . . . . . . . . . . . . . . . . . . 7 Flat products . . . . . . . . . . . . . 11 Slabs. . . . . . . . . . . . . . . . . . . . 16 Ferrous scrap . . . . . . . . . . . . 19 Pig iron. . . . . . . . . . . . . . . . . . 23 Iron ore . . . . . . . . . . . . . . . . . 28 Coking coal . . . . . . . . . . . . . . 34 Macroeconomics . . . . . . . . . 37 Prices . . . . . . . . . . . . . . . . . . . 38
Imports get more attractive as long as dollar weakens
100 US D / P Y J US D / UR E 0,85

Prices may rise in November
The downward trend has strengthened in the global market this month. Since mid-September, prices for square billet and finished products have gone down by $50/t and $25-40/t, respectively. Slab prices have decreased by smaller amount; however, considering a drop in HR sheet quotations, slab prices are likely to fall further as well. Meanwhile, prices are unlikely to drop too deep even amid weak demand, as production costs of semis and finished steel stay largely stable or decline just slightly. According to Metal Expert’s estimates, trade in the global market for steel products will revive when traders and consumers believe (or are forced to believe by producers) that prices are bottom-low and no further decrease is possible. In the circumstances, producers may take advantage of dollar’s weakening against major world currencies. In particular, European traders have already benefited from the drop in dollar exchange rate and purchased substantial tonnages of pig iron on stronger euro in October. Demand for imports has also grown in Turkey where steelmakers have increased scrap purchases. Importantly, the rise in buying activity has not resulted in the increase in prices as the supply was sufficient and the suppliers accepted bid prices just to sell as quickly as possible. According to Metal Expert’s estimates, demand for raw materials and steel products may grow worldwide in the second half of November – December. In case dollar keeps weakening, traders and consumers will buy as much steel products as needed by the end of October, after which prices will start moving down at slightly higher pace.

95 U S D/J P Y

0,8 U S D/E UR

90

0,75

85

0,7

80 J an 10

Apr 10

0,65 J ul 10 Oct 10 S ource : Meta l E xpe rt

Forecast of key prices in the world steel markets
scrap Turkey, HMS1&2 (80:20), c&f from USA pig iron CIS, fob Black Sea billet Ukraine, fob slab Asia-Pacific, c&f from Brazil rebar Turkey, fob HRC China, (SS400) JIS G3101, fob Source: Metal Expert, $/t * - Metal Expert forecast Jun.10 323 448 453 645 533 608 Jul.10 346 425 483 623 544 588 Aug.10 397 454 546 560 593 604 Sep.10 400 465 557 561 606 612 Oct.10 380 435 515 580 580 608 Nov.10* Dec.10* 375 400 443 450 510 530 560 560 570 595 600 615 Jan.11* 430 460 560 580 620 640

Long products
Long products price forecast
probability – 60% Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the support enough to keep up consumption at current level. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing; business activity hikes in global markets mainly when traders replenish stocks. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets. The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets. Short-term outlook: - Moderate demand recovery in Europe, US and Asia is possible in end November-December, prior to New Year and Christmas holidays - The international sanctions imposed by the United Nations against Iran and a sharp decrease in rial exchange rate against the US dollar in the short-term perspective will entail the decrease of import shipments to the country - Significant growth of demand in the global market is expected no earlier than February-March 2011 - In November-December the decrease of capacity utilization is expected - Competition remains high in the global long products markets, putting downward pressure on prices - High production cost prevents long products prices from substantial falling
S C E NAR IO No .1 T urkis h re bar exp ort p rice forecas t, fob forecas t in repo rt of Augus t 10 750 620 595 600 606 593 580 $/t 450 300 150 Nov .10 0 Aug.10 Oct.10 S ep.10 J an.11 D ec .10 Apr.11 Mar.11 F eb.11 570 750 633 600 580 590 610 D ec .10 625 J an.11 600 $/t 450 300 150 Aug.10 S ep.10 Nov .10 0 Oct.10 F eb.11 Mar.11 Apr.11 S C E NAR IO No .1 Italy rebar e xpo rt pric e forecas t, fob forecas t in repo rt of Augus t 10

Scenario No.1:

grew less than expected

Note: the forecast has been revised downward as in September-October finished steel product demand

Scenario No.2:

probability – 40% Long-term outlook: due to the downsizing of the government reflation programmes in China, the country’s domestic market faces oversupply urging a rise in exports. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing. Prices for steel products and raw materials decrease worldwide, market faces ups and downs because of the demand/supply imbalance.
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© Metal Expert +38 0562 39 88 50

World Steel Markets, October, 2010

Analysis

Long products

Steel product demand expected to recover in Q1 2011
World rebar prices
Sep.10 DOMESTIC MARKET (dd) USA 656 Italy 651 EXPORT PRICES (fob) Turkey Ukraine Oct.10 678 651

In October, long product prices have been going down worldwide. In midOctober, Turkish rebar was offered at $575/t FOB, down $35/t m-o-m. CIS prices dropped by $40/t to $560/t FOB; Chinese longs quotations – down $10/t to $625/t FOB. Nevertheless, suppliers from Turkey and CIS already started pushing for price increase. Demand and prices for steel products used in construction have been down since mid-September. Although steel products from Turkey and CIS are $10-15/t cheaper than domestic ones, demand in the Middle East and North Africa is slack. Relatively stable demand is observed only in Iraq and Saudi Arabia. End consumer demand in Iran is affected by the unfavourable economic situation. There are no large-scale governmental infrastructural projects expected to be implemented before the beginning of a new fiscal year (FebruaryMarch); some upturn in demand (in December-January) will be attributed to the traders’ stock-building campaigns. End consumer demand in South East Asia is somewhat stronger than in other regions, but local consumers, having built up their stocks, now sit on the fence waiting for the prices to decline. Stagnation in the US and European economy on the whole and in the construction sector, in particular, is having an adverse effect on the demand for steel products used in construction. Despite a growth in Euro exchange rate against US dollar (from 1.27 in late August to 1.39 in mid-October), European steel consuming industries will recover slowly having little support from the government. According to Metal Expert, long product demand will be weak worldwide till 2011, but despite that the producers will keep trying to raise their prices. Some upturn in the US, European and the Middle Eastern markets is expected in end November-December; in South East Asia – in January on the eve of Chinese New Year. A significant increase in demand and steel product prices is possible in February-March. In November-January, the largest exporters will have their production costs high. In late Q4-early Q1, steel scrap prices for Turkish steelmakers will be on the rise at low supply. Rebar production cost in Turkey will gain 17% by Q2 2011, Metal Expert forecasts. Import semis price will increase by $80/t in December-March, according to Metal Expert. CIS production cost will also be on the increase in late 2010-early 2011 owing to a 2% growth in iron ore quotations, in particular. Production costs in Europe will grow in Q1 2011 following a 4% increase in contract prices for iron ore. Thus, high level of the production cost will restrain steel product price reduction and will promote prices in late 2010-early 2011. Competition will have a negative influence on prices. Weak consumer demand in the Middle East urges Turkish exporters and CIS steelmakers to reduce prices: price for Turkish products is $620/t C&F, for CIS products - $615/t C&F. Prices for Chinese products amounted to $685/t C&F, while they were just $30/t above those of the traditional suppliers a month ago. This increase is explained by the growth of domestic prices, by $10-15/t over the month. Chinese products are

606 596

581 565

IMPORT PRICES (c&f) UAE 636 581 Italy 633 613 Source: Metal Expert, $/t, average monthly prices

Middle East: stable oil-and-gas sector favours development of regional economy
R igs i n ope ration, '000 pcs . P rice for B re nt C rude Oil, $/ b 280 270 260 250 240 230 220 S e p 09 J an 10 May 10 90 85 80 75 70 65 60 S e p 10

S ource : Me tal E xpe rt

Turkey: domestic construction sector may give support to deteriorating export market
100 B ui lding permits i n T urk ey 80

'000 pcs

60

40

20 J an 09

May 09

S e p 09 J an 10 May 10 S ource : Me tal E xpe rt

World Steel Markets, October, 2010

© Metal Expert +38 0562 39 88 50

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up 15%. According to Metal Expert. Back in August-September. In late Q3. Metal Expert forecasts.Long products Analysis offered in Southeast Asia at $630-650/t C&F Turkish ones – at $610-640/t C&F. Turkey shipped 0. while a significant upturn will be possible with the beginning of a new construction season in March-April.9mt t of steel products used in construction. CIS exports grew by 13% to 0.87mt. while in mid-Q1 2011 the shipments will start rising backed up by growing demand. demand for Turkish products is expected to rise in the region soon. Demand and prices for steel products used in construction will decrease worldwide in November. . Back to top 4 © Metal Expert +38 0562 39 88 50 World Steel Markets. Therefore. In late August-September. traders in the Middle East and Southeast Asia increased purchases pushing up long product supply. Some increase is expected in December-January. Chinese products were $75/t cheaper. October. steel product supply will be moving down in the global market in November-January due to the reduction in production. 2010 .

10 Jan.10 Sep.11 Mar.data as for the first two weeks of the month Back to top World Steel Markets.11 Feb. $/t Source: Metal Expert Long products spot prices in major world markets Oct.10 625 566 579 620 582 517 632 587 588 567 556 564 575 561 544 544 652 567 569 722 650 702 607 Aug. October.11 dd Shanghai (export equivalent) fob (BS4449 grade) fob Black Sea exw exw exw exw c&f fob exw c&f Anzali exw exw 662 604 576 683 581 643 590 626 593 598 630 753 700 713 620 596 683 602 656 651 633 606 610 653 824 713 720 625 560 685 615 675 640 610 580 590 610 840 735 725 620 550 670 610 650 625 600 570 575 600 800 695 710 640 585 650 600 665 640 635 595 590 630 780 700 715 660 610 665 610 680 645 660 620 625 650 775 710 720 665 625 680 625 690 670 680 635 640 675 800 715 730 680 655 710 655 705 690 705 660 650 705 795 730 745 710 680 735 680 730 710 730 685 675 730 810 750 domestic China export CIS export Russia domestic Ukraine domestic USA domestic Italy domestic Italy import Turkey export Turkey domestic Iran import Iran domestic Wire Rod USA domestic monthly average prices. $/t.10 649 598 580 641 651 507 653 587 577 549 529 561 529 566 535 533 640 556 566 750 680 718 609 Jul.10 662 604 575 683 581 576 643 625 590 626 580 604 606 622 598 593 753 630 622 713 620 700 653 Sep.10 713 620 568 683 602 596 656 638 651 633 633 651 649 640 610 606 824 653 636 724 600 713 668 Oct.10* 716 625 628 690 604 565 678 608 651 613 608 638 629 655 595 581 844 613 581 736 600 735 634 China export South Korea domestic Russia domestic Ukraine domestic Ukraine export USA domestic USA import Italy domestic Italy import Italy export Spain domestic Algeria import Poland domestic Turkey domestic Turkey export Iran domestic Iran import UAE import Japan domestic Japan export Wire Rod USA domestic exw USA import c&f US Gulf Source: Metal Expert.Statistics Long products PRICES Rebar China Long products prices forecast in major world markets Aug. average monthly prices * .10 Nov.10 Dec. 2010 © Metal Expert +38 0562 39 88 50 5 .11 Apr.10 Oct.09 Rebar China domestic dd Shanghai (export equivalent) fob (BS4449 grade) exw exw exw fob Black Sea exw c&f US Gulf exw c&f fob exw ñ&f exw exw fob exw c&f Anzali c&f Dubai dd fob 586 493 605 541 531 453 528 529 524 491 492 569 521 522 459 463 524 477 483 674 500 652 547 Jun.

October. 2010 6 © Metal Expert +38 0562 39 88 50 .Long products Statistics TRADE REBAR IMPORT by country Algeria UAE Iran Egypt Iraq Others REBAR EXPORT by country Turkey Ukraine Spain Germany Russia Others WIRE ROD IMPORT by country USA South Korea Germany Netherlands Italy Thailand Others WIRE ROD EXPORT by country China Ukraine Germany Japan Turkey Others OTHER BARS IMPORT by country Germany South Korea USA France Italy Others OTHER BARS EXPORT by country China Italy Japan Germany Russia Others SECTIONS IMPORT by country Iran South Korea Germany Canada France Others Global long products trade structure Apr 10 2106 208 131 54 95 50 1567 2097 412 219 157 149 124 1037 1654 117 149 108 138 63 40 1039 1681 181 170 182 120 92 936 1529 198 96 87 78 69 1000 1585 226 142 122 112 105 878 1871 123 162 79 88 60 1360 May 10 2021 152 177 139 33 69 1451 1970 563 221 119 92 72 903 1869 137 122 128 150 97 73 1162 1825 309 187 176 109 141 903 1634 245 104 98 87 75 1025 1613 265 148 121 131 79 869 1972 350 112 137 64 70 1239 Jun 10 1960 96 167 91 74 110 1422 1958 646 158 152 122 61 818 1801 117 154 103 50 97 66 1213 1791 361 120 156 126 126 903 1615 220 80 82 94 77 1062 1807 354 147 120 140 120 925 1823 207 84 83 81 77 1291 Jul 10 1584 188 85 85 76 124 1027 1620 558 223 144 30 72 593 1001 131 106 6 0 17 84 658 1071 228 89 49 105 97 503 1054 54 120 86 79 23 692 1145 282 39 117 37 85 585 1047 69 74 1 80 55 768 1037 163 115 111 110 26 512 tonnes) Aug 10 n/a n/a n/a 53 16 50 n/a n/a n/a 179 n/a n/a 61 n/a n/a n/a 100 n/a n/a n/a 37 n/a n/a 139 156 n/a 112 n/a n/a n/a n/a 61 n/a n/a n/a n/a n/a 206 n/a 108 n/a 84 n/a n/a 56 63 n/a n/a n/a n/a n/a 61 n/a n/a 132 n/a n/a 7 months 10 12564 1020 789 575 567 522 9091 12782 3507 1452 889 708 577 5649 10561 861 827 601 588 504 421 6759 10602 1487 1023 952 808 662 5670 9824 1234 656 576 563 431 6364 10395 1631 890 799 762 720 5592 11512 1186 841 542 481 477 7986 11222 1502 1246 941 941 798 5794 7 months 09 16703 1984 1145 505 2305 905 9859 17121 6039 1298 1404 749 748 6882 7970 317 301 551 523 421 146 5712 8047 431 734 809 375 495 5202 6884 983 241 421 387 314 4537 6648 436 768 324 502 525 4092 8653 564 439 550 387 443 6270 8406 500 807 889 908 592 4710 % change 10/09 -25% -49% -31% 14% -75% -42% -8% -25% -42% 12% -37% -5% -23% -18% 33% 3 times 3 times 9% 12% 20% 3 times 18% 32% 3 times 39% 18% 2 times 34% 9% 43% 26% 3 times 37% 45% 37% 40% 56% 4 times 16% 2 times 52% 37% 37% 33% 2 times 91% -1% 24% 8% 27% 33% 3 times 54% 6% 4% 35% 23% SECTIONS EXPORT 1786 1736 1762 by country China 240 229 269 Spain 182 208 210 Turkey 137 131 150 South Korea 186 142 135 Germany 150 135 125 Others 892 892 874 Source: ISSB. Metal Expert estimation (in ‘000 Back to top World Steel Markets. customs statistics.

the probability – 40% country’s domestic market faces oversupply urging a rise in exports.10 D ec .The fall of prices and profitability of the steel products manufacturers will cause the decrease in capacities utilization in November-December 2010.10 Oct. prior to New Year and Christmas holidays.2: Long-term outlook: due to the downsizing of the government reflation programmes in China.11 Mar.10 Nov .10 J an. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market. October. c&f Anzali forecas t in repo rt of Augus t 10 620 grew less than expected Note: the forecast has been revised downward as in September-October finished steel product demand Scenario No. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing. significant growth of demand is expected no earlier than February-March 2011 .11 F eb. 2010 © Metal Expert +38 0562 39 88 50 575 590 7 .11 Apr. fob 700 600 546 557 560 515 510 530 500 $/t 400 300 200 Aug. Prices for steel products and raw materials decrease worldwide.11 Apr.11 F eb.11 Mar.11 forecas t in repo rt of Augus t 10 700 609 639 600 500 400 300 200 Aug.10 J an. putting downward pressure on prices .High production cost prevents billet price from substantial falling . Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. Short-term outlook: . business activity hikes in global markets mainly when traders replenish stocks.10 Oct.1: Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the probability – 60% support enough to keep up consumption at current level.1 Ukrainian billet price forecas t.Moderate demand recovery in the global markets is possible in end November-December.Competition remains high in the global billet markets. market faces ups and downs because of the demand/supply imbalance.11 $/t 595 S C E NAR IO No .10 D ec . The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets.10 Nov . Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.10 100 S ep.Billet Billet price forecast Scenario No.10 100 S ep. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets.Square billet supply may become excessive by the end of this year S C E NAR IO No . which will entail the reduction of semis consumption .1 Iranian billet pric e fo re cas t. Back to top World Steel Markets.

though contracts were signed at $510-515/t.6 10. In October. weak demand for import semis is explained by sufficient stocks. prices for HMS 1&2 (80:20) from the USA and the EU dropped by $20-25/t in October. Besides. billet prices have been going down in the world market. Unfavourable situation in finished product segment is having an adverse effect upon the market for square billet. Most trading companies in the Middle East already built up their stocks in August-September. the UAE and Egypt in October (down $30/t ). Demand and prices in the world market of semi-products will start growing in mid-Q1. so they are not interested in import semis now.1 10 9. Some upturn has been observed in Taiwan and Singapore. Turkish exporters have reduced the prices by $45/t to $530/t FOB. has supported the international sanctions imposed by the United Nations. despite the discounts allowed: the difference between rebar and square billet price amounted to $60/t in midOctober. which used to open letters of credit necessary for Iran’s steel product imports. CIS billet was priced at $530-535/t FOB Black Sea. already in November-December. a billet price is unreasonably high comparing with a finished product one. but sufficient stock volumes and weak construction sector will depress demand in October-November. Some upturn is expected in December-January. The difference in Philippines and Thailand is at the minimum acceptable level of some $60-65/t. October. the UAE. while in other countries of Southeast Asia the price for square billet is high: the difference between rebar and square billet price in Taiwan is about $25/t. when producers try to raise prices. against $85-90/t in June-July.5 10.9 J an 10 Apr 10 J ul 10 Oct 10 S ource : Me tal E xpert US D / IR R e xchange rate © Metal Expert +38 0562 39 88 50 World Steel Markets. square billet demand in main consuming regions will remain weak. $/t average monthly prices Iran: decrease in rial exchange rate against dollar will make square billet imports unprofitable 10. the difference between rebar and billet price in Turkey is $45/t (against minimally acceptable $60/t). In mid-October. CIS square billet production cost grew by $25-30/t m-o-m. The situation in the Southeast Asia is somewhat better. Some increase is possible in late Q4. According to Metal Expert. demand being very unstable. though. Slack demand for import square billets in Turkey is attributed to the decreases in steel product markets and more attractive prices for steel scrap. Turkish consumers may resume the material purchases. down $50/t m-o-m.2 10. September’s boom in Iranian long product market has been replaced by the reduction in demand and prices related to a sharp decrease in rial exchange rate against the US dollar (down 6% since early September).10 Oct. Import price for square billet in Iran has decreased by $65/t to $580/t C&F Anzali. however. A significant growth in demand is not expected before end-February-March. In South Korea. as well as in some other countries of the region. According to Metal Expert.3 10.4 10. 2010 .rebar” amounted to $200/t (minimum $180/t). Besides. High production cost will restrain the reduction of billet prices. which resulted in decrease in exporters’ average margin to $80/t. while the margin “steel scrap . Square billet demand is weak worldwide.10 IMPORT PRICES (c&f) SEA 588 574 Iran 639 600 USA 558 568 Source: Metal Expert. which will promote scrap prices. Weak demand for long products in the Middle East and North Africa has caused a considerable drop in steel product prices in Saudi Arabia. The 2-10% increase in CIS iron ore and coke prices expected in Q1 2011 will result in a growth of production cost and underpin export quotations of square billets. In Turkey. the global market will be experiencing a downturn in demand and prices till end-November-December.Billet Analysis Billet price unlikely to rise before December Since late September. In SeptemberOctober. According to Metal 8 World billet prices Sep.

producers of the Middle East plan to put into operation some steelmaking plants having total capacity of 5. A drop in demand for semis will also be determined by an increase in production in importing countries. supply will reduce and underpin demand. Turkish suppliers boosted shipments by 10%. Some upturn in business activity is expected in December and the second half of January. so the market may even face some shortage.8 mt). A significant increase in demand and prices is possible in late February-March. October. which makes 55% of an average monthly square billet imports in Turkey in 2010. in particular. Khouzestan Steel – 2. The global market for square billets may see some excess of supply till the end of the year. In September. one of the Turkey’s largest billet producers. In Q1 2011. According to Metal Expert. keeps boosting the output: 120. Yolbulan Bastug Metalurji. The market will get oversaturated if demand for square billets stays weak in November-December. Back to top World Steel Markets. square billet production cost in Turkey will grow by 17% in Q1 2011 owing to a $80/t increase in scrap quotations. square billet exports from CIS amounted to 1mt .2 mtpy. square billet price will be down worldwide in late October-early November.6 mtpy (Khorasan Steel – 1. up 12% m-o-m.000 t planned to be produced in October (3-fold increase since the plant was launched in June 2010). 2010 © Metal Expert +38 0562 39 88 50 9 . In JanuaryMarch. capacity utilization making about 70%. Meanwhile.Analysis Billet Expert.

10 582 609 533 557 554 545 546 506 685 594 539 Sep. Metal Expert estimation (in ‘000 Back to top 10 © Metal Expert +38 0562 39 88 50 World Steel Markets.09 472 447 487 432 448 407 406 438 581 463 464 Jun. $/t. average monthly prices * .data as for the first two weeks of the month TRADE IMPORT by country Iran Turkey Vietnam Taiwan Egypt South Korea Saudi Arabia Lebanon Philippines Others Global square billet trade structure Apr 10 2842 261 199 188 105 169 119 141 92 86 1484 May 10 2716 370 273 150 112 111 62 116 125 84 1314 Jun 10 2785 471 187 120 94 81 130 115 137 120 1330 Jul 10 2102 288 259 60 71 109 161 167 154 23 810 2030 369 534 257 130 122 86 3 529 tonnes) Aug 10 n/a 136 n/a 196 n/a 52 141 15 96 122 n/a n/a 521 450 n/a n/a 108 81 n/a n/a 7 months 10 19339 3208 1536 993 858 826 750 742 699 687 9041 18067 4423 3567 2015 978 832 622 478 5154 7 months 09 18807 2676 2350 1200 538 920 495 210 809 317 9292 17703 4736 4741 980 987 790 638 362 4469 % change 10/09 3% 20% -35% -17% 60% -10% 51% 4 times -14% 2 times -3% 2% -7% -25% 2 times -1% 5% -3% 32% 15% EXPORT 2928 2776 2574 by country Russia 606 599 526 Ukraine 533 559 523 Turkey 395 229 274 France 150 152 152 Japan 93 122 95 Brazil 134 83 92 Germany 86 88 89 Others 931 944 823 Source: ISSB.Billet Statistics PRICES Billet spot prices in major world markets Oct. 2010 . customs statistics.10 524 499 558 483 497 453 453 550 663 520 518 Jul.10 543 526 543 500 516 486 483 528 646 537 528 Aug.10* 580 605 568 548 553 523 523 545 710 573 598 Far East import c&f from CIS Iran import c&f Anzali USA import c&f US Gulf Turkey export fob Russia export fob Far East Russia export fob Black Sea Ukraine export fob Black Sea Brazil export fob China export fob UAE import c&f Dubai Italy domestic exw Source: Metal Expert.10 588 639 558 574 561 557 557 532 713 598 572 Oct. October.

Prices for steel products and raw materials decrease worldwide.Competition remains high in the global flat products markets. significant growth of demand is expected no earlier than February-March 2011 .1: Short-term outlook: .10 Nov .11 Mar. prior to New Year and Christmas holidays. putting downward pressure on prices . the probability – 40% country’s domestic market faces oversupply urging a rise in exports. fob forecas t in repo rt of Augus t 10 800 623 600 $/t 400 200 0 Aug. fob forecas t in repo rt of Augus t 10 575 608 600 Nov . The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets.2: Long-term outlook: due to the downsizing of the government reflation programmes in China.11 Apr. F eb.1 C hine s e hot-rolled c oils export price fore cas t. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets. October.11 D ec .Decrease of iron ore prices under the long-term contracts in Q4 allows steelmakers to decrease their production costs.10 800 600 598 615 640 J an. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. market faces ups and downs because of the demand/supply imbalance.11 600 $/t 400 200 0 Aug.Cancellation of the VAT rebate on Chinese HRC export restrains supply of Chinese non-alloyed products on the global markets . in Q1 2011 iron ore prices will grow again S C E NAR IO No . China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market.10 S ep. Scenario No.10 Oct. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.Flat products Flat products price forecast probability – 60% Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the support enough to keep up consumption at current level.10 S ep.11 Back to top World Steel Markets.10 J an.10 615 grew less than expected Note: the forecast has been revised downward as in September-October finished steel product demand Scenario No.10 Apr. 2010 © Metal Expert +38 0562 39 88 50 11 . business activity hikes in global markets mainly when traders replenish stocks.11 Mar.10 600 D ec .10 Oct.Moderate demand recovery in the global markets is possible in end November-December.11 F eb.1 R us s ian hot-ro lled co ils export price fore cas t.11 604 612 S C E NAR IO No .

As a result. Thanks to the growth in carmaking and construction industries. the share of imports grew from 34% to 54%. Meanwhile. According to IMF.Flat products Analysis Demand for flat products will be low in Q4 This month. Due to curtailing of governmental support programmes. October. the country’s economic growth will slow down gradually. 2010 .7% in Q2. In November. the country’s apparent consumption of flats (mostly sheet) grew by 43% y-o-y.09 Nov. steel product consumption is likely to reduce in H2.7% y-o-y in Q1 and by 10.by 20% and 41%. prices for HRC of Russia’s MMK have gone down by $20-35/t to $590-610/t FOB Black Sea. and consumers have no need in replenishing stocks.5 mt in H1. So. a weak demand for flats will push prices down. however. has increased consumption considerably this year. average monthly prices In H1. However. South Korea’s flats consumption will drop by 15-20% in H2. the largest suppliers have begun to reduce prices on weak demand. the country’s GDP will rise by about 10% this year. In Q4.3% in Q2). flats purchases will be scarce because of decreasing product prices and low exports of Turkish welded pipes. In Iran. $/t. apparent consumption of HR flats increased to 6. prices will get bottom-low and purchases are expected to resume. in H1 the estimated consumption of HR sheet increased by 30% in China. A steady growth of consumer activity in world markets is expected to start in midQ1. Meanwhile. so steel product consumption will stay rather high. the Chinese authorities toughen the crediting policy.10 EXPORT PRICES (fob) Russia (fob Black Sea) 623 620 China 625 633 DOMESTIC PRICES (exw) Turkey 648 638 Italy 678 713 IMPORT PRICES (c&f) SEA import from CIS 672 661 Italy 664 670 Source: Metal Expert. demand for HR products from the main importers will be low in November. Turkey increased consumption of flat products. according to Metal Expert’s estimates. respectively. some revival will be registered in Southeast Asia.10 Oct. World HRC prices Sep.09 Feb. In Asia-Pacific.6% y-o-y in Q1 and by 1. Chinese steelmakers are planning to raise domestic prices. This year. A slack demand and cheap imports ruined plans of European producers to raise domestic prices when vacations season ended. South Korean producers have decided to keep prices at September level while granting some discounts. down $5-15/t m-o-m. In December. Despite this. at the earliest. major importing countries will reduce flats consumption. According to Metal Expert’s estimates. judging by the decrease in leading indicators. In H2 compared to H1. as consumers will build stocks before Christmas holidays.10 M ay. sales will get slightly improve in the EU and the USA. in H2 flats consumption is expected to be lower than in the first six months of the year. Considering GDP forecast for 2010 and current macroeconomic situation. In H1. China’s steel product consumption is growing quickly along with the national economy. Contrary to the world trend. more than doubled consumption of flats in H1 thanks to favourable economic situation (GDP increased by 11. However. the share of imports in Iranian flats consumption will drop further in H2 due to toughening of sanctions imposed by UN against the country. apparent consumption of flats increased in largest importing countries H1 2009 25 20 15 mt 10 5 0 South Korea Italy Turkey Iran +43% H1 2010 +63% +145% +127% Source: M etal Expert OECD’s leading indicators decrease predicts the economy slowdown in H2 103 Italy Turkey 102 Korea China 101 100 99 Aug. Europe’s GDP grew just by 0. demand for flat products is weak.10 Source: M etal Expert 12 © Metal Expert +38 0562 39 88 50 World Steel Markets. In December. In January. Chinese HRC SS 400 and SAE 1006 are priced at $600-610 /t and $625-645/t FOB. Their plans can be hindered by high stocks and adverse conditions in export markets.10 Aug. Turkey. the largest flats importer. on the contrary. Meanwhile. respectively. so demand will weaken as well. of plate and CR flats . to avoid economy overheating. South Korea. According to Metal Expert’s estimates. steel consuming industries keep reducing production this year.

demand from the main importers of HR flats will stay weak. Some improvement is expected in December. In general. According to Metal Expert’s estimates. while HR flats prices grew only by 15%-25% during the year. producers respond quickly to market changes by cutting production to avoid the problems they had in 2009. mills have been decreasing utilization of production capacities on demand decline. October. so prices will keep decreasing. In Q4. This year. while a stronger growth of demand and prices is likely to start in mid-Q1. The Far Eastern steelmakers will also have their production costs increased. As a result. 2010 © Metal Expert +38 0562 39 88 50 13 . In Q4. which will restrain the decrease in prices. In early 2011. the growth is likely to continue. By Metal Expert’s estimates. supply and demand are currently balanced in the global market for flat products. Having been lowered to $127-135/t C&F China. Starting from mid-Q2. Back to top World Steel Markets. the global flats output dropped 8% in July from May. iron ore prices will go up 5-12% worldwide in Q1. contract prices for iron ore (October-December delivery) are yet 2-2. in H2 production of flats will be lower than in the first six month of the year. the leading world suppliers of flats will face the growth of production costs.5 times as high as in 2009. iron ore and coking coal prices will go up $3-8/t in CIS.Analysis Flat products During the next six months.

10 Oct.10 639 643 642 606 598 567 571 650 634 665 645 719 658 665 645 603 591 609 648 830 670 703 728 740 709 671 755 749 756 751 806 756 743 747 765 761 Sep. $/t Source: Metal Expert Flat products spot prices in major world markets Oct. $/t.data as for the first two weeks of the month 14 Back to top World Steel Markets.11 690 645 640 610 675 690 710 690 660 630 655 640 720 665 655 630 690 720 740 720 675 655 685 655 740 690 685 655 720 730 750 730 700 675 710 700 Aug.11 Apr. VAT) 639 652 660 China export fob 604 612 608 Russia export fob Black Sea 598 623 600 Ukraine export fob Black Sea 571 593 580 USA import c&f US Gulf 634 655 645 USA domestic exw 650 649 620 Italy domestic exw 665 678 695 Italy import c&f 645 664 655 Turkey import from Russia c&f 603 639 620 Turkey import from Ukraine c&f 589 617 600 Iran import c&f Anzali 609 658 640 Iran domestic exw 591 607 630 monthly average prices.10 625 617 610 612 576 610 545 665 631 677 633 715 676 669 617 606 593 585 637 823 720 688 685 699 688 650 775 750 766 748 809 750 705 716 783 716 Aug.Flat products Statistics PRICES Flat products prices forecast in major world markets Nov.10 Sep.10 Jan. VAT) fob c&f exw fob Black Sea exw fob Black Sea exw c&f US Gulf exw c&f exw daf fob exw c&f exw c&f Anzali c&f Dubai dd fob 525 471 537 530 517 484 495 630 555 578 552 624 565 572 623 558 584 580 554 697 560 637 598 600 638 604 732 678 689 680 698 668 720 652 693 630 Jun. average monthly prices * . 2010 © Metal Expert +38 0562 39 88 50 .11 Mar.09 HRC China China Far East Russia Russia Ukraine Ukraine USA USA Italy Italy Poland Poland EU Turkey Turkey Iran Iran UAE Japan Japan CRC China domestic export import from CIS domestic export domestic export domestic import domestic import domestic import export domestic import from Russia domestic import import domestic export domestic dd Shanghai (incl.10 637 608 600 644 567 641 544 728 653 708 623 741 647 710 645 636 598 590 628 818 760 746 726 713 680 656 829 781 799 731 842 748 731 749 789 710 Jul.10 652 625 672 595 623 586 593 649 655 678 664 750 680 674 648 639 607 658 665 843 675 699 720 771 734 693 751 774 798 792 831 784 765 755 799 769 Oct.10 HRC China domestic dd Shanghai (incl. October.10* 651 633 661 602 620 594 590 638 660 713 670 779 724 700 638 648 630 655 683 820 680 700 725 768 724 700 735 778 834 824 882 832 780 758 805 768 dd Shanghai (export equivalent) China export fob Far East import from CIS c&f Russia export fob Black Sea Ukraine export fob Black Sea USA domestic exw USA import c&f US Gulf Italy domestic exw Italy import c&f Poland domestic exw Poland import daf Turkey domestic exw Turkey import from Russia c&f Iran domestic exw Iran import c&f Anzali Source: Metal Expert.10 Dec.11 658 600 575 550 600 610 670 635 595 570 600 610 680 615 600 570 630 640 675 660 615 590 615 620 700 640 615 595 650 670 690 670 630 615 635 630 Feb.

21% 14% 25% 14% 5% 31% 6% 22% 19% 30% 42% 39% 31% 78% 3% 5 times. 10% 22% 40% 18% 18% -1% 58% 3 times. 38% 41% 3 times.10 7 months 10 7 months 09 % change 10/09 4787 n/a 48682 32918 48% 686 259 203 123 288 3228 4817 914 1081 515 386 370 1552 1536 371 135 36 6 92 897 1694 502 325 163 97 70 537 2117 439 15 54 120 112 1376 2433 489 397 384 54 176 934 2913 403 5 185 207 195 1918 3150 524 n/a 121 150 n/a n/a n/a 948 313 639 478 n/a n/a n/a 326 49 11 n/a 90 n/a n/a 222 329 144 103 n/a n/a n/a 397 n/a n/a n/a 111 n/a n/a 471 396 306 n/a n/a n/a n/a 410 n/a n/a n/a 266 n/a n/a 664 616 397 n/a n/a n/a 4985 2974 2616 2609 2375 33123 47165 7594 7160 4051 2790 2676 22894 14095 2553 1234 1056 623 589 8039 14690 3295 2289 1325 1050 1001 5730 21783 3045 1161 1023 888 821 14845 22483 3481 2525 1977 1450 1448 11602 30471 2794 2214 1585 1435 1242 21200 30637 4720 4042 3008 2509 2508 13849 2843 1996 1608 750 1560 24161 32635 4273 1006 3678 2295 1908 19475 11980 2570 780 401 671 615 6943 11815 1571 1887 1165 840 880 5473 16662 2878 950 861 685 579 10709 17214 1954 2453 363 997 1229 10219 21876 1793 1967 1190 1031 513 15382 21680 1404 2078 2303 2063 2330 11502 75% 49% 63% 3 times. October.10 Aug. Metal Expert estimation ( in 981 854 605 594 416 425 423 80 487 65 2255 1132 ‘000 tonnes) Back to top World Steel Markets. 52% 37% 45% 78% 7 times. 94% 31% 22% 8% 20% CR UNCOATED PRODUCTS IMPORT by country China Germany Italy France India Others CR UNCOATED PRODUCTS EXPORT by country Japan South Korea China Germany Taiwan Others COATED FLAT PRODUCTS IMPORT by country China Germany France USA Thailand Others COATED FLAT PRODUCTS EXPORT 4690 4763 by country China 721 782 Japan 595 575 South Korea 452 421 Germany 403 392 Belgium 424 413 Others 2095 2180 Source: ISSB.10 May. -7% -4% 16% 24% 2 times. 2010 © Metal Expert +38 0562 39 88 50 15 .10 Jun.Statistics Flat products TRADE HR SHEET <10 mm IMPORT by country South Korea Italy India Iran Turkey Others HR SHEET <10 mm EXPORT by country Japan China Russia South Korea France Others HR PLATE >10 mm IMPORT by country South Korea India Iran Germany China Others HR PLATE >10 mm EXPORT by country China Japan South Korea Ukraine Germany Others Global flat products trade structure Apr. customs statistics. 46% 18% 14% 39% 56% 13% 33% 39% 2 times.10 7784 7967 7518 773 453 530 197 399 5432 7624 1032 1321 672 446 410 3743 2106 376 201 119 101 95 1214 2264 520 272 236 168 218 850 3352 475 216 161 119 137 2244 3408 514 353 238 260 210 1834 4661 431 371 226 209 174 3249 824 415 444 879 326 5079 7577 1178 1405 653 401 430 3510 2511 319 226 410 109 94 1352 2354 575 289 220 151 156 963 3429 435 201 169 126 137 2360 3488 495 351 321 246 240 1834 4770 393 380 207 237 187 3366 729 623 350 261 232 5323 7376 1183 1421 453 400 431 3488 2417 339 242 213 124 97 1402 2472 645 348 189 155 165 969 3528 437 191 200 144 133 2424 3602 518 349 504 235 182 1814 5147 422 421 246 235 194 3629 5166 Jul.

11 D ec . The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets. business activity hikes in global markets mainly when traders replenish stocks.During Q4 slabs demand decrease weighted down by flat products market slump . significant growth of demand is expected no earlier than FebruaryMarch 2011 .10 Apr.10 S ep.In H2 slabs demand from China will remain low due to the decrease of production costs in the domestic market .2: country’s domestic market faces oversupply urging a rise in exports.10 J an.10 Oct.Decrease of iron ore prices under the long-term contracts in Q4 allows steelmakers to decrease their production costs. in Q1 2011 iron ore prices will grow again S C E NAR IO No . c&f forecas t in repo rt of Augus t 10 700 600 565 575 565 544 545 555 500 $/t 400 300 200 100 Nov .11 Apr. Prices for steel products and raw materials decrease worldwide.1 S E A s labs p rice fore cas t. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high.1 E U s labs pric e fo re cas t. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing.11 F eb. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.10 Nov .10 0 Aug.10 Oct. October. the probability – 40% Back to top 16 © Metal Expert +38 0562 39 88 50 World Steel Markets. prior to New Year and Christmas holidays. Long-term outlook: due to the downsizing of the government reflation programmes in China. c&f forecas t in repo rt of Augus t 700 600 580 560 561 400 300 200 100 Aug.1: Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the probability – 60% support enough to keep up consumption at current level.Slabs Slab price forecast Scenario No.11 S C E NAR IO No .10 D ec . The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets. Short-term outlook: .11 F eb.10 0 S ep.11 Mar.11 560 560 500 $/t 580 Note: the forecast has been revised downward as in September-October finished steel product demand grew less than expected Scenario No. 2010 .11 Mar. market faces ups and downs because of the demand/supply imbalance.10 J an. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market.Moderate demand recovery in the global markets is possible in end November-December.

Brazil is also expected to see the rise in iron ore quotations as Vale will step up export prices. the largest slab importer in the region. respectively.10 Apr. CIS slab production costs will increase due to the 5-8% rise in iron ore prices and the 3-4% increase in coke and coking coal prices.10 Oct. this difference has reduced from $65-70/t to $45-50/t. due to weak demand for flats and the decrease in scrap quotations. Meanwhile. for instance. In South Korea.10 Source: M etal Expert Demand for import slabs gets weaker in major markets 300 200 100 $/t 0 -100 China -200 Jan.10 M ay. Slab imports get less attractive in the region as the difference between prices for HRC and slabs supplied from CIS has narrowed from $80-100/t in September to $35-45/t this month. Meanwhile. slab offers from CIS to SE Asia remain at $580-600/t C&F. demand for import slabs stays low in SE Asia because of sufficient inventories of feedstock and weak demand for finished flats. In Q4. The global market is likely to see some revival of demand in DecemberJanuary urged mostly by the need to restock. In October.10 Jul. At the beginning of 2011. October. Metal Expert believes. Italy. suppliers have been forced to reduce HRC prices by $40/t to $610/t EXW. The growth of prices will resume not earlier than December. slab demand will remain low in a short-term outlook to start improving no sooner than the end of Q4.Analysis Slabs Slab demand to weaken in Q4 World slab prices Sep. Slab prices will be supported by the growth of production costs. prices 561 549 583 575 average 561 555 583 580 monthly In October. The slowdown of finished flats market restrains the growth of slab prices. the latest deals have been made at $570-580/t C&F SE Asia.10 Source: M etal Expert SEA USA Differe nce betwee n HRC and slabs prices in regions World Steel Markets. The country is unlikely to increase flat product output much this year because demand stays weak. due to weak demand. Chinese and Russian exporters have cut HR sheet prices by $5-15/t and $20-35/t. SE Asian markets face a decline of domestic prices. Europe shows little demand for slabs as well.10 IMPORT PRICES (c&f) SEA Iran USA (US Gulf) EU Source: Metal Expert. This month.10 O ct. Back to top Slab demand is weak in Italy because of reduced output of finished flat products 1400 1200 1000 fla ts products sla bs impor t '000 t onn es 800 600 400 200 0 Jan. For instance. In Europe. end consumer demand will hardly grow earlier than mid-Q1. 2010 © Metal Expert +38 0562 39 88 50 17 . Apart from a decrease in import quotations.10 M ar. $/t. the drop of finished flats production being among the reasons behind that.10 Jul. domestic prices for flats have dropped by some EUR 20/t. Metal Expert believes flats quotations will keep going down in November. In the USA. According to Metal Expert’s estimates. suppliers offer substantial cuts in actual deals even though the general price level is still the same as in September. cut flats production by 30% in Q3. In the USA. domestic prices for raw materials will keep growing in CIS because of steady demand in China and somewhat limited supply. Slab quotations are likely to decline soon due to weak demand and low prices for finished flats.

Slabs Analysis PRICES Slab spot prices in major world markets Oct. 9% EXPORT 2290 2301 2925 2025 by country Russia 571 655 1005 596 Ukraine 530 540 595 576 Brazil 346 249 471 296 Japan 267 216 364 210 Canada 93 127 107 164 Others 483 515 382 182 Source: ISSB. $/t.10 533 531 604 510 585 505 488 480 Jul. customs statistics.10 2220 276 303 342 273 284 741 May. average monthly prices * .10* 561 555 583 580 553 560 540 500 Far East import c&f from CIS Iran import c&f Anzali USA import c&f US Gulf EU import c&f Brazil export fob Russia export fob Far East Russia export fob Black Sea Ukraine export fob Black Sea Source: Metal Expert.10 1972 337 503 194 298 230 410 Aug.10 n/a 358 n/a n/a 98 n/a n/a n/a 637 271 253 398 n/a n/a 7 months 10 15689 2666 2469 1978 1703 1599 5274 16245 4793 3443 2212 1999 902 2897 7 months 09 11314 1960 462 1475 873 827 5717 11472 3026 2047 1605 2129 14 2651 % change 10/09 39% 36% 5 times. October.10 560 518 555 544 529 524 540 500 Sep.10 561 549 583 575 553 556 540 500 Oct.10 533 508 577 521 563 505 496 482 Aug. 2010 .data as for the first two weeks of the month TRADE IMPORT by country South Korea USA Taiwan Thailand Italy Others Global slab trade structure Apr. Metal Expert estimation ( in ‘000 tonnes) Back to top 18 © Metal Expert +38 0562 39 88 50 World Steel Markets.10 2290 376 361 268 233 224 828 Jul.09 473 431 477 421 433 448 403 401 Jun.10 2388 338 410 320 234 289 798 Jun. 34% 95% 93% -8% 42% 58% 68% 38% -6% 65 times.

11 Mar.10 Jan.11 Apr.10 Mar.10 Sep.10 Sep.11 Feb. c&f forecast in repo rt of August 10 500 397 400 430 380 375 400 400 $/t 300 200 100 0 Nov.1 Price fo recast fo r US HMS1&2 scrap imports to T urkish market.1 Price fo recast fo r Japanese HMS2 scrap imports to S outh Korean market. Back to top World Steel Markets. prior to New Year and Christmas holidays. c&f forecast in repo rt of August 10 500 388 420 445 Jan. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets.The fall of prices and profitability of the steel products manufacturers will cause the decrease in capacities utilization in November-December 2010.10 Apr.Ferrous scrap Scrap price forecast Scenario No.Moderate demand recovery in the global markets is possible in end November-December.11 Feb. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.In end-October-January 2010 scrap supply remains low SCENARIO No. significant growth of demand is expected no earlier than FebruaryMarch 2011 . Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high.1: probability – 60% Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the support enough to keep up consumption at current level. Prices for steel products and raw materials decrease worldwide.10 SCENARIO No. 2010 Scenario No.10 Oct. the country’s domestic market faces oversupply urging a rise in exports.2: © Metal Expert +38 0562 39 88 50 385 376 19 .In Q4 demand increase from China may urge the scrap price growth in the global market . China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market.11 400 $/t 300 200 100 0 Nov. market faces ups and downs because of the demand/supply imbalance. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing.11 Dec.10 Oct. which will entail the reduction of scrap consumption . Short-term outlook: .11 Aug.10 Dec. business activity hikes in global markets mainly when traders replenish stocks.10 385 grew less than expected Note: the forecast has been revised downward as in September-October finished steel product demand probability – 40% Long-term outlook: due to the downsizing of the government reflation programmes in China.11 Aug. October. The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets.

Nevertheless. scrap demand and prices will be moving down. Japanese HMS2 has fallen in price by $25/t to $360/t C&F over the same period. Amid sluggish demand for construction steel from Middle Eastern consumers. In Southeast Asia.cpt China: domestic scrap is still more price-competitive than import material S crap import D iffe re nce be twe e n import and dome s tic pri ces 1000 800 600 400 200 0 Oct 09 F eb 10 100 80 60 '000 t 40 20 0 -20 -40 J un 10 Oct 10 S ource : Me tal E xpert $/ t South Korea: slow recovery of steel industry keeps scrap imports down 30 25 20 15 10 5 0 2006 *es t imation 2007 2008 2009 2010* S ource : Me tal E xpert mt E AF s t ee l production S crap import © Metal Expert +38 0562 39 88 50 World Steel Markets. In winter. some temporary upswing in traders’ activity may be observed in the market. domestic prices lost $25/t in the USA and Japan). October. prices for import scrap were just $15/t higher than domestic ones (in September. Spain) 392 388 SEA (South Korea. In November-December. Scrap demand is not expected to surge until January-February. Limited supply. i. HMS1&2 (80:20) scrap originating from EU and the USA was quoted to Turkish customers at $370-380/t C&F against $395-400/t C&F in September. low construction activity and heavy steel stocks resulted in a $10-15/t reduction of longs prices in October. Metal Expert forecasts. CIS scrap will be in short supply because of bad weather hampering scrap collection. In late Q4-early Q1. In China. In March-April. $/t.Ferrous scrap Analysis Scrap prices likely to go up in December In October. until the year end supply from these countries will remain moderate in the global market due to low levels of industrial production and. finished product inventories are still high in the country (in September. 2010 . average monthly prices * .e. import from USA) 410 393 Source: Metal Expert. In the Far East. Metal Expert believes. which will restrain the further growth of domestic steel product quotations and. global steel product demand will remain weak. to $575/t FOB. push down scrap demand. while the gap between steel product and billet prices was $45/t. scrap generation. scrap demand is unlikely to improve notably in Turkey. stronger demand for steel products will buoy the upward price trend in the global scrap market. accordingly. will curb the price drop to push quotations up in December-February. the US material of HMS1 grade is available at $385/t C&F.10 Oct. although import material has become more attractive owing to the decrease in prices in the global market. consequently. Until the end of 2010. In the middle of the month. In Southeast Asia. In November. in February-March. Turkish exporters were forced to cut quotations by $35/t from September. In October. yet end-consumer’ demand may go steadily up ahead of the new fiscal year and construction season. The decline in demand and prices seen in the finished steel product segment adversely affects scrap market. down $30/t from the previous month. Even though scrap quotations have lowered in the home markets of the largest exporters (in October. scrap demand is still weak. demand for import scrap was strong as compared to semis – the difference between rebar and scrap quotations is $200/t in October ($205/t in the previous month). the landslide of scrap prices has made scrap more attractive to buyers – in October.10 IMPORT PRICES (c&f) Turkey 400 390 Europe (Italy*. The material will be purchased just occasionally and mainly for immediate needs. the spread between rebar and scrap quotations increased by $65/t to $250/t. Despite the decline in finished steel product prices. the government measures aimed at curtailment of excessive capacities keep depressing steel production. scrap prices have been decreasing worldwide. it will be tight supply that will support scrap prices. the difference was $35/t). the necessity for stock replenishment prompted Turkish scrap consumers to resume purchases. however. scrap demand is slack in the region due to the fall in steel product demand and prices. they shrank just by 2%). In early Q4. Meanwhile. In November-December. In China. Back to top 20 Global scrap prices Sep.

average monthly prices * . import from USA) import SEA (South Korea.10 Turkey 29 33 34 46 45 46 47 Turkey 31 32 32 25 28 15 15 Spain 34 34 32 35 35 33 38 South Korea 26 38 27 27 27 28 28 Back to top World Steel Markets. 2010 © Metal Expert +38 0562 39 88 50 21 . Petersburg Rostov-on-Don St.10 Sep.10 Aug.cpt Global freight rates at steel scrap shipments Vessel type Handysize Sea-river Sea-river Sea-river Source: Metal Loading port St.10 Jun.10 Jul.10 Oct. Petersburg Nakhodka Expert.09 Jun.10 346 352 367 315 306 260 305 366 346 438 318 323 Aug. Spain) import Italy domestic market Europe (Rotterdam) export USA export Russia (European part) domestic market Russia export SEA (South Korea.10 Sep. October. $/t.10 280 323 280 369 267 378 259 287 249 284 245 250 254 305 330 382 297 349 369 439 277 327 280 324 Jul. VAT included fob Rotterdam fob East coast cpt.10 Oct. VAT excluded fob Black/Baltic Sea c&f c&f dd Jiangsu.data as for the first two weeks of the month ** .10* 397 400 390 370 392 388 376 392 375 364 369 350 360 364 353 291 298 300 343 361 361 395 410 393 385 388 382 447 457 460 362 365 359 363 371 363 Turkey import Europe (Italy**. import from Japan) import China domestic market Japan export USA export Source: Metal Expert. $/t Country Russia Russia Russia Russia Discharging port Iskenderun ports of Marmara Sea North ports Pusan Country Apr.Statistics Ferrous scrap PRICES Steel scrap spot prices in world major markets c&f c&f cpt. VAT included fob fob West ñoast Oct.10 May.

2010 . October.10 n/a n/a 479 472 n/a n/a n/a 75 n/a n/a n/a n/a n/a 45 69 53 45 n/a n/a n/a 531 437 n/a n/a n/a 15 20 72 9 n/a 40 n/a n/a 30 n/a 35 n/a n/a 7 months 10 57094 11312 3950 2055 3895 4264 2914 621 1975 1414 4755 1051 2767 550 430 344 345 14452 57094 10035 3563 5096 2893 1567 2368 1861 962 781 526 1301 307 835 1575 207 2679 85 2127 18326 7 months 09 % change 10/09 55074 4% 12929 6416 1828 2819 3048 3081 655 1931 1473 4015 844 2237 460 353 172 340 12472 55074 8339 8872 4238 1850 757 1570 3481 1155 608 1470 1449 62 720 690 219 2285 13 2193 15103 -13% -38% 12% 38% 40% -5% -5% 2% -4% 18% 25% 24% 20% 22% 100% 1% 16% 4% 20% -60% 20% 56% 2 times 51% -47% -17% 28% -64% -10% 5 times 16% 2 times -5% 17% 7 times -3% 21% Sources: Metbl Expert.10 9932 1729 694 377 618 769 986 110 359 240 790 179 489 126 124 47 59 2235 9932 1455 558 894 394 230 538 295 235 163 93 211 52 165 216 33 540 4 301 3556 Global steel scrap market structure May.10 8413 1708 420 446 610 479 336 67 283 271 863 173 374 104 65 47 43 2125 8413 1409 323 727 406 168 246 178 117 96 84 238 53 152 289 29 528 4 560 2805 Jul.Ferrous scrap Statistics TRADE EXPORT by country USA Japan Russia France Great Britain Canada Hong Kong Belgium Romania Germany Czech Republic Netherlands Kazakhstan Ukraine Thailand Switzerland Others IMPORT by country Turkey China South Korea Taiwan Canada USA India Vietnam Thailand Pakistan France Japan Belarus Egypt Hong Kong Germany Brazil Italy Others Apr. ISSB (in ‘000 tonnes) Back to top 22 © Metal Expert +38 0562 39 88 50 World Steel Markets.10 5633 1651 446 285 539 312 247 117 183 178 153 144 115 68 33 48 50 1066 5633 1248 506 566 467 290 258 213 200 109 151 150 85 116 68 30 44 5 40 1086 Aug.10 9571 1967 446 422 495 600 523 87 252 275 870 185 366 129 114 50 43 2746 9571 2140 360 767 444 266 304 186 153 50 51 210 57 191 390 28 539 4 487 2945 Jun.

not allowing suppliers to push prices up . Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the Short-term outlook: . business activity hikes in global markets mainly when traders replenish stocks. October. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market. prior to New Year and Christmas holidays.10 Sep. which will entail the reduction of demand in the spot markets for raw materials .10 Ma r. c&f forecast in repo rt of August 10 Note: the forecast has been revised downward as in September-October finished steel product demand grew less than expected Scenario No.11 Sep. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. fo b Black Sea 600 500 465 460 450 435 443 400 $/t 300 200 100 0 Nov.High production cost promotes pig iron prices SCENARIO No.11 O ct.10 Jan. Prices for steel products and raw materials decrease worldwide.11 454 forecast in repo rt of August 10 600 500 473 440 435 465 400 $/t 300 200 100 0 Aug.Pig iron demand remains low until December 2010. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing.10 Nov.10 Apr.11 Apr.2: Long-term outlook: due to the downsizing of the government reflation programmes in China. market faces ups and downs because of the demand/supply imbalance.1: support enough to keep up consumption at current level.10 Jan.Moderate demand recovery in the global markets is possible in end November-December. the probability – 40% country’s domestic market faces oversupply urging a rise in exports. The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets.10 Dec. significant growth of demand is expected no earlier than FebruaryMarch 2011 .In Q4 the risk is high that the merchant pig iron supply will become excessive .11 23 SCENARIO No.10 Aug.11 Ma r.11 Dec.1 Price fo recast fo r pig iron imports to the US market. Back to top 456 World Steel Markets.Ferrous scrap Pig iron probability – 60% Statistics Pig iron price forecast Scenario No.1 Price fo recast fo r pig iron exp orts fro m CIS.The fall of prices and profitability of the steel products manufacturers will cause the decrease in capacities utilization in November-December 2010. 2010 © Metal Expert +38 0562 39 88 50 475 .11 O ct. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.10 Feb.10 Feb.

demand for pig iron is also remaining weak due to better scrap prices – the difference between pig iron and scrap prices is some $80-100/t. However. merchant pig iron supply in CIS will increase due to expanded production at Tulachermet – 24 Global pig iron prices Sep.Pig iron Analysis Pig iron demand to stay slack till steel product markets improve By mid-October. a hike in steel scrap prices as well as improving markets for steel products will cause a rise in pig iron demand. Meanwhile. 2010 . which will influence demand for pig iron. traders may increase steel product purchases in the US and the EU in end-November December. Exporters will attempt to lift prices for finished steel products in November-December.5 0 J un 09 Oct 09 0% F eb 10 J un 10 S ource : Me tal E xpe rt 10% mt E s t imate d pig iron cons umption S hare of import 20% 25% 15% 5% © Metal Expert +38 0562 39 88 50 World Steel Markets. against $60/t in August. In the Far East. Despite a short-time revamp of a blast furnace at Svobodny Sokol. Buying import pig iron is also unprofitable for China domestic material prices are $80/t below the import ones (including all taxes and delivery).10 IMPORT PRICES (c&f) South Korea 485 483 USA 473 448 Europe 473 468 Source: Metal Expert. According to Metal Expert’s estimates. despite attempts of major flats producers to raise prices. $/t. rather heavy inventories that consumers have. whereas the difference between pig iron and scrap prices has dropped from the traditional $100/t to $75-80/t. Russian suppliers have cut offer prices by $30/t to $430/t FOB. Metal Expert expects global demand for pig iron will stay slack till the end of this year. to $390-395/t FOB southern ports and $410-415/t FOB northern ports. Pig iron demand remains sluggish in major consuming regions. Turkey accounting for 6% of global trade may become an alternative market. average monthly prices SE Asia: pig iron prices are less attractive than scrap ones 180 150 120 90 60 30 0 May 10 $/ t D iffe re nce be twe e n pig iron and s te e l s crap prices J un 10 Aug 10 Oct 10 S ource : Me tal E xpert USA: increasingly dependent on import pig iron 4 3. urged both by hopes for the end-user demand surge and US dollar weakening to the local currencies. Activity in the region may increase before Lunar New Year’s holidays. and if end-user demand remains low during this period.5 2 1. October. In SE Asia. prices will keep decreasing in the pig iron market by end-Q4. for CIS suppliers first of all. are also depressing demand. Producers of steel products in the EU and the US were not increasing capacity utilization rates in September-October. The situation is similar in the US. quotations are declining due to non-existent demand from consumers (down $20 /t in 4 weeks). In the EU. with its prices sliding down gradually (the price spread between import pig iron prices and domestic scrap prices in the US is $ 110/t). steel scrap is growing more attractive in the US. however a significant rise in demand and prices can be expected no sooner than February-March. In October traders in EU and Turkey bought significant volumes of pig iron. suppliers can hardly keep current price level amid heavy stocks of steel products.5 1 0. In the second half of November stocks at trader’s premises will restrain the possible price growth. Taiwan and Singapore in particular. Import pig iron is growing more attractive for Turkey: the difference between steel product and pig iron prices has grown to $190/t by October (from the beginning of the year. Moreover. in January-March. Global market of pig iron will remain oversupplied in late Q4. the difference was $170/t on average). Metal Expert expects steel product market to remain unfavorable till the end of this year. besides.10 Oct.5 3 2. Demand and prices in finished steel product market are falling. prices for Brazilian pig iron have dropped by $45/t since the previous month. ahead of Christmas holidays.

which will affect production costs accordingly. Therefore. According to Metal Expert’s estimates.000 tonnes) will be sold to the export markets. The company decreased significantly its raw and finished steel production volumes due to overhaul works. In Q1. At the same time. the decline will be restrained by high production costs. export of merchant pig iron produced by Novolipetsk steel plant in Russia is also set to increase. High production costs will keep pig iron prices from plummeting. Pig iron capacities in Brazil were operating at 30-35% in October. Back to top World Steel Markets. sluggish market for steel products will cause a decline in pig iron prices till the end of this year. up 76% m-o-m. improving demand for steel products will push up merchant pig iron prices. Production costs in the CIS countries will remain high till the end of this year. Metal Expert believes imbalance between demand and supply worldwide will exert some pressure on pig iron quotations. as Vale will retain a system of discounts for the material due to low prices for Brazilian pig iron in the US. since producers have hard time selling their products in both domestic and export markets. the excess pig iron production volumes (at least 50. According to Metal Expert estimations.Analysis Pig iron October output plan is 180. a global 4% rise in long-term contract prices for iron ore will boost up prices for the material in domestic market of Brazil. October. In October-November. Domestic iron ore prices in Brazil will be staying steady till the end of Q4.000 t. In late Q1-early Q2 2011. high production costs will limit a decrease in pig iron prices till the end of Q4 and will serve as another argument for a price rise in early 2011. 2010 © Metal Expert +38 0562 39 88 50 25 . however iron ore and coke prices will move up by 2-10% in January-March.

VAT included fob Black/ Baltic Sea Oct.10 473 473 490 485 443 507 465 Oct. 2010 .10 445 438 458 443 457 525 425 Aug. Petersburg Russia ARA Country Italy USA Netherlands/ Belgium Apr.10 456 453 456 446 438 510 454 Sep.data as for the first two weeks of the month 319 290 434 418 423 406 438 431 459 443 448 425 Global freight rates at pig iron shipments Vessel type Loading port Country Discharging port Panamax Illyichevsk Ukraine Margera Panamax Yuzhny Ukraine New Orlean Handysize St.10 Jun.09 330 313 383 325 324 422 304 Jun. $/t.10 17 25 19 22 22 20 14 25 17 18 24 19 Source: Metal Expert.10 451 451 471 461 441 563 448 Jul. October.Pig iron Statistics PRICES USA Europe China South Korea Brazil Russia Russia (Black/ Baltic Sea) import import domestic market import export domestic market export Pig iron spot prices in world major markets c&f c&f cpt. $/t Back to top 26 © Metal Expert +38 0562 39 88 50 World Steel Markets.10* 448 468 496 483 408 488 448 Russia (Far East) export fob Far East Ukraine (Black Sea) export fob Black Sea Source: Metal Expert.10 Oct.10 May. average monthly prices * . VAT included c&f fob. south ports exw.10 21 28 14 21 31 16 19 25 18 Jul.10 Sep.10 Aug.

10 90289 52263 7168 3200 2585 2676 2637 2401 2560 716 9946 1120 226 48 0 40 272 175 4 39 539 1120 552 16 1 157 64 21 30 35 40 204 124530 90289 Jun. to USA Ukraine Brazil incl.10 84499 47578 7085 3180 2780 2461 3250 2011 2525 770 9097 949 188 54 0 95 163 154 33 53 418 949 445 80 36 62 72 58 25 30 21 120 114364 84499 Aug.10 84386 48841 6844 3180 2764 2488 2250 2037 2100 625 9499 n/a 288 1 164 120 87 50 30 n/a n/a n/a n/a 22 62 n/a 20 n/a 30 n/a n/a n/a 118039 84386 7 months 10 606573 350623 47850 22718 18439 17984 18063 15870 15987 5185 65883 7748 2479 942 229 866 1398 1007 168 371 2466 7748 2479 573 133 587 714 344 246 197 261 2215 820274 606573 7 months 09 490622 304565 34536 17130 12181 14838 9806 14335 9358 3124 46886 7475 2362 849 363 779 1805 773 222 247 2060 7475 1232 2073 136 688 375 94 47 181 175 2473 652204 490622 % change 10/09 24% 15% 39% 33% 51% 21% 84% 11% 71% 66% 41% 4% 5% 11% 11% -23% 30% -24% 50% 20% 4% 2 times -72% -3% -15% 91% 4 times 5 times 9% 49% -10% 26% 24% Sources: Metal Expert. to USA India SAR Others IMPORT by country USA China Thailand Italy South Korea Taiwan Japan Belgium Spain Others STEEL PRODUCTION APPARENT CONSUMPTION Global pig iron market structure Apr. World Steel Association. to Italy incl.10 88183 51623 6682 3100 2569 2646 2464 2470 2025 828 9508 1165 239 30 0 181 223 118 33 70 418 1165 241 122 18 89 86 54 117 35 39 363 120436 88183 May. October. 2010 © Metal Expert +38 0562 39 88 50 27 .10 86235 49766 6840 3353 2692 2676 2428 2011 2526 746 9387 1480 696 342 199 194 231 195 2 46 311 1480 385 92 71 99 64 23 24 25 25 671 118234 86235 Jul. ISSB (in ‘000 tonnes) Back to top World Steel Markets.Statistics Pig iron BALANCES PRODUCTION by country China Japan India Brazil South Korea Germany Ukraine United States Italy Others EXPORT by country Russia incl.

11 forecast in repo rt of August 10 170 172 Scenario No. Scenario No.10 Feb. business activity hikes in global markets mainly when traders replenish stocks.In Q4 decrease of prices under the long-term contracts will entail growth of import share in iron ore consumption in China . The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in steel product market. market faces ups and downs because of the demand/supply imbalance. Prices for steel products and raw materials decrease worldwide.10 Nov. c&f (spo t prices) 200 155 150 $/t 100 50 0 Aug.No oversupply is seen in the iron ore spot market .Favourable situation on the finished steel market in China in Q4 10 and Q1 11 will support iron ore prices .11 O ct.In Q1 10 iron ore prices under the long-term contracts will increase by 5-12% .Raw materials consumption stays extensive in China .Import ore demand in China grows in December due to necessity to build stocks before Lunar New Year celebrations .11 Apr.Iron ore Iron ore price forecast probability – 60% Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the support enough to keep up consumption at current level.1: Short-term outlook: . Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.11 Ma r.5%) in China.Strengthening of the leading exporters’ national currencies favours a surge in iron ore export prices in the spot market SCENARIO No.2: country’s domestic market faces oversupply urging a rise in exports. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market. the probability – 40% 28 © Metal Expert +38 0562 39 88 50 149 158 163 World Steel Markets.10 Jan. The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets.10 Sep. Back to top Long-term outlook: due to the downsizing of the government reflation programmes in China.1 Import price fo recast fo r Indian co ncentrate (63. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. 2010 .10 Dec. October.

Brazilian material (Fe 64. prices for HR flats and longs have increased by 2-10% since the middle of September. 2010 © Metal Expert +38 0562 39 88 50 29 . $/t. At the same time. At the same time.9 mt per day in H1. spot prices for iron ore may climb further up due to some improvements in global steel product market and the expected increase in long-term contract prices. iron ore prices will stay largely stable until the end of the year. Global market for finished steel is expected to improve notably in February-March. iron ore demand from the largest importing country is expected to grow from the middle of October as prices for foreign material will be more attractive. iron ore consumption will be lower than in January-June. According to Metal Expert’s estimates. In H2. which will buoy iron ore prices. So.5%) have increased to $153-157/t C&F to Chinese buyers in the middle of October. Chinese domestic market for finished products will stay relatively strong. As steel products are in poor demand in other markets of the world. According to Metal Expert’s estimates. The increase in prices for January-March shipments of Rio Tinto’s iron ore may be as big as 12% as contract prices for the material produced by Rio Tinto depend on the average prices effective in the previous quarter.10 O ct. the price gap between domestic HR flats (without VAT) and imported concentrate widened to $405-415/t.10 IMPORT PRICES (c&f) Import from India (63. According to Metal Expert’s forecast. from $145-149/t C&F at the beginning of the month.10 Offers of Indian concentrate (Fe 63. At the beginning of October. In Chine.10 Source: M etal Expert Global iron ore consumption to grow in 2010 500 2009 2010 400 300 mt 200 100 0 Q1 Q2 Q3 Q4 Source: M etal Expert World Steel Markets.10 Jun. According to Metal Expert’s estimates. contract prices for the company’s iron ore may be $142/t FOB. Metal Expert estimates. and the total volume will add only 1%. The Chinese have bought little iron ore abroad in the first half of October. weak demand from abroad and high steel product stocks at home will restrain the growth of domestic finished product quotations. The increase in steel product prices is unlikely to resume in most of global markets until December. suppliers will have to cut prices soon. In Q1 2011.Analysis Iron ore Iron ore contract prices to grow in Q1 Chinese iron ore concentrate spot prices Sep. Back to top 157 161 153 DOMESTIC PRICES (exw. Quotations of iron ore fines from Brazil’s Vale and Australia’s BHP Billiton will grow by 5-7% (considering the average spot price in China in September-November). average monthly prices In China. The global average daily production of pig iron amounted to about 2. which is by 3-6% more than in early September and 15% more than the Q2 average. down from some 2. global consumption of non-agglomerated iron ore will grow by 12-14% y-o-y in 2010 due to strong pig iron production in H1. Business activity is likely to start reviving in these segments in the second half of October to support steel product prices after national holidays are over in the country.7 mt in July and August.5-65%) is still available at $160-163/t C&F. contract prices for iron ore may gain about 5-12% in Q1 2011. in Q4 pig iron output will increase by about 3% everywhere except China.5% Fe) 149 Import from Brazil (65% Fe) 158 Import from Australia (62% Fe) 147 Oct. price gap between finished products and iron ore 15% wider than in Q2 350% difference between domest ic HRC an d import iron ore prices in C hina 300% 250% 200% Apr.10 Aug. October. VAT included) 66% Fe 175 183 64% Fe 122 124 Source: Metal Expert.

10 Jun.10 Oct.10 151 156 156 169 112 Jul.10 May.10 Sep.10 149 158 147 175 122 Oct.10 135 142 135 166 110 Aug. VAT included Oct. $/t.Iron ore Statistics PRICES Import from India (63.data as for the first two weeks of the month Global freight rates at iron ore shipments Vessel type Loading port Country Capesize Tubarao Brazil Capesize ports of Australia Australia Panamax Yuzhny Ukraine Source: Metal Expert. 2010 .10 22 19 29 28 8 7 11 11 43 43 46 45 Back to top 30 © Metal Expert +38 0562 39 88 50 World Steel Markets.10* 148 158 153 183 124 Source: Metal Expert.10 Aug.10 155 165 154 179 119 Sep.5% Fe) Import from Brazil (65% Fe) Import from Australia (62% Fe) 66% Fe 64% Fe Chinese iron ore concentrate spot prices dynamics import import import domestic market domestic market c&f c&f c&f cpt. October. average monthly prices * .09 95 96 91 116 80 Jun. VAT included cpt.10 Qingdao China 25 31 29 Qingdao China 11 13 10 North ports China 42 45 47 Jul. $/t Discharging port Country Apr.

ISSB (in ‘000 tonnes) World Steel Markets. 2010 Back to top © Metal Expert +38 0562 39 88 50 31 . October. Vale India Russia Ukraine USA South Africa Canada Sweden Iran Kazakhstan Others EXPORT by country Australia Brazil Ukraine Netherlands Russia Indonesia Canada Kazakhstan Mexico Chile Sweden South Africa Others IMPORT by country China Japan South Korea Germany Netherlands Taiwan France United Kingdom Belgium Russia Italy Spain Argentina Poland Others Q2 09 415029 98518 99528 25271 53393 68905 57656 57767 22757 14459 3361 13091 8057 3872 6190 3915 14609 204696 92938 54887 4646 2294 4055 629 3104 2400 130 1279 784 505 37045 204696 157373 19746 8058 2589 2832 1968 1154 1794 448 1800 1023 347 420 146 4998 Global non-agglomerated iron ore market structure Q3 09 436246 112319 106980 27360 56808 70061 64153 47748 24231 18662 5820 14459 5925 3664 6447 4690 15241 232563 104161 66728 5444 3985 2713 2193 3089 2550 454 1821 1377 706 37341 232563 163344 27781 10267 6778 5000 3024 2601 2347 662 1650 1098 905 799 1336 4968 Q4 09 458718 121685 107796 29683 55778 66632 60776 52306 24664 19184 9400 15161 8305 6489 6456 4554 16086 229130 104369 61997 34442 4672 2632 1882 2758 2000 291 1954 1504 571 10058 229130 151641 31058 10948 6172 7258 2351 2908 2380 1673 1400 1832 1131 680 1754 5945 Q1 10 438909 95911 103663 28390 53488 72384 66452 59510 23891 18855 9940 15067 7171 6158 6341 4398 15620 225980 100110 60619 4570 4025 2303 1429 1249 1714 796 1449 1104 681 45932 225980 149327 29913 12564 6902 5992 3172 3025 1994 1483 1408 1889 1329 583 1140 5258 Q2 10* 486842 131920 103316 28435 53207 75961 73153 59506 24977 19913 11894 14900 9769 6223 6662 4656 17146 230464 105309 57245 5632 4700 2646 3449 2644 2364 968 1368 1023 881 42237 230464 149661 31541 12527 7957 7029 3395 3837 1603 1961 1550 1267 825 651 750 5910 % change Q/Q % change 10/09 11% 17% 38% 0% 0% -1% 5% 10% 0% 5% 6% 20% -1% 36% 1% 5% 6% 10% 2% 5% -6% 23% 17% 15% 2 times 2 times 38% 22% -6% -7% 29% -8% 2% 0% 5% 0% 15% 17% 7% 27% -20% 32% 10% -33% -38% 12% -34% 12% 34% 4% 13% 0% 10% 27% 3% 10% 38% 4 times 14% 21% 61% 8% 19% 17% 13% 13% 4% 21% 2 times -35% 5 times -15% -2% 7 times 7% 30% 74% 14% 13% -5% 60% 55% 3 times 2 times 73% 3 times -11% 4 times -14% 24% 2 times 55% 5 times 18% *Metal Expert estimate **Company share. Australia Sources: Metal Expert. BHP Billiton** incl.Statistics Iron ore BALANCES PRODUCTION China Australia incl. Rio Tinto** Brazil incl.

October.Iron ore Statistics Chinese non-agglomerated iron ore market structure Apr 10 PRODUCTION IMPORT by country Australia Brazil India South Africa Iran Chile Indonesia Ukraine Peru Venezuela Russia Mexico Mauritania Kazakhstan Others EXPORT APPARENT CONSUMPTION 88074 54075 19893 11647 12794 3179 1395 193 972 910 435 341 200 120 263 212 1521 1 95469 May 10 91056 50189 22218 8011 10396 3228 1045 381 604 944 597 308 483 185 151 271 1367 0 92985 Jun 10 101550 45398 20876 7916 8243 2211 1235 414 617 524 609 261 352 255 140 297 1448 0 93126 Jul 10 76809 49312 22808 9689 6547 3647 1205 626 365 507 142 271 443 613 647 294 1508 0 85412 Aug 10 82215 50697 19285 9763 5085 2042 1072 444 467 412 616 797 522 230 278 164 9521 0 89338 7 months 10 561555 348301 149884 66735 71065 18391 7836 3142 4652 4851 3386 1925 2343 1534 2013 1439 9106 1 612230 7 months 09 453630 338674 148021 69996 69029 20268 2829 2209 3021 3929 2710 1575 4418 165 3630 1506 5369 1 551879 % change 10/09 24% 3% 1% -5% 3% -9% 3 times 42% 54% 23% 25% 22% -47% 9 times -45% -4% 70% 38% 11% Sources: Metal Expert. ISSB (in ‘000 tonnes) Back to top 32 © Metal Expert +38 0562 39 88 50 World Steel Markets. 2010 .

October. 2010 © Metal Expert +38 0562 39 88 50 33 . ISSB (in ‘000 tonnes) Back to top World Steel Markets.Statistics Iron ore TRADE EXPORT by country Brazil South Africa Canada Ukraine Russia USA Sweden Kazakhstan Chile Australia Others IMPORT by country China Germany Japan Canada USA Netherlands South Korea Italy Austria Slovakia Australia Taiwan Turkey Russia Argentina United Kingdom Others Apr 10 15307 3365 4283 1830 1034 743 930 1299 688 293 209 632 15307 1253 384 759 545 612 755 323 357 250 351 554 261 407 400 357 192 7548 Global agglomerated iron ore market structure May 10 15335 4120 3312 1731 1063 797 1016 1309 739 421 187 640 15335 1708 1382 722 702 752 702 525 591 378 406 218 364 134 439 276 314 5724 Jun 10 16064 4521 4136 1532 1103 859 1018 1109 600 342 320 524 16064 1775 1487 970 864 542 532 358 135 304 405 384 67 445 250 214 0 7333 Jul 10 15874 5086 4478 1642 1078 1204 1003 439 380 264 196 105 15874 1966 1112 919 965 534 530 602 680 480 290 489 628 471 100 229 381 5499 Aug 10 n/a 4356 n/a n/a 1045 1065 n/a 175 499 n/a n/a n/a n/a 1671 n/a 850 n/a n/a 302 501 189 412 279 n/a 185 41 n/a 461 275 n/a 7 months 10 105645 28327 27876 11461 7256 5921 5060 8016 4499 2018 1428 3783 105645 12395 7809 5819 3993 3649 4056 2883 2471 2017 2341 2622 2548 2725 2352 2075 1735 44156 7 months 09 71837 13479 26233 8475 5424 5351 1516 4571 2830 1002 1162 1794 71837 16686 3332 2678 1402 1138 278 3052 1192 636 1690 1068 585 2725 850 547 807 33170 % change 10/09 47% 2 times 6% 35% 34% 11% 3 times 75% 59% 2 times 23% 2 times 47% -26% 2 times 2 times 3 times 3 times 15 times -6% 2 times 3 times 39% 2 times 4 times 0% 3 times 4 times 2 times 33% Sources: Metal Expert.

1: Long-term outlook: the demand stimulation programme provides the Chinese domestic market with the probability – 60% support enough to keep up consumption at current level. Short-term outlook: .11 Apr. October. Demand from end consumers strengthens at a slow pace in other global markets in 2010 and 2011 due to curtailment of state backing.11 Ma r. fob Queensland forecast in repo rt of August10 300 233 $/t 100 0 Aug.10 Sep. Back to top Scenario No. Steelmakers have to cut production when demand drops as profit margins narrow and the risk of glut is high. China’s high consumption and strengthening yuan stimulate economic recovery in the countries supplying raw materials and finished products to the Chinese market.10 Jan. The volatility of finished steel product prices increases because prices under long-term contracts for iron ore and coke are revised quarterly now and speculative activities intensify in raw materials and steel product markets.1 Sp ot price fo recast fo r Australian hard coking coals.Strengthening of the Australian national currency favours a surge in export prices for coal in the spot market SCENARIO No.11 O ct.In Q4 deterioration of steel demand in most of the global markets restrains coal prices growth. significant growth of demand is expected no earlier than February-March 2011 . the country’s domestic market faces oversupply urging a rise in exports. market faces ups and downs because of the demand/supply imbalance.10 Nov.Coking coal Coking coal price forecast Scenario No. business activity hikes in global markets mainly when traders replenish stocks.2: 34 © Metal Expert +38 0562 39 88 50 215 217 200 226 235 240 World Steel Markets.Raw materials consumption stays extensive in China . The cost of steel production remains high or grows further in 2010 and 2011 owing to consolidation of supply in raw material markets.Coal supply from major providers is not excessive . Prices for steel products and raw materials decrease worldwide.11 probability – 40% Long-term outlook: due to the downsizing of the government reflation programmes in China. 2010 .10 Dec. Demand from end consumers grows just slowly in other regions in 2010 and 2011 due to curtailment of state backing.10 Feb.

world steel markets will apparently keep weakening. the difference between import and domestic prices (VAT excluded) for coking coal is around $30-40/t in China. Supply of Australian coking coal to the global market may shrink in the short term as due to the storm that hit the country’s east coast in October the suppliers have problems with transportation of the material. spot prices for high-quality Australian coal grew in price by $8-9/t. imports will remain rather high. October. contract prices for coking coal may grow following the upturn in spot quotations forecasted for Q4 and the increase in global finished product prices anticipated at the beginning of 2011. 2010 © Metal Expert +38 0562 39 88 50 35 . Thus. In early October. Unlike other world markets. In Q1 2011. Steady growth of global steel product quotations is likely to begin in mid-Q1. In November. In Q4. As usual. In general. China’s coking coal imports reduce y-o-y 14 12 10 8 mt 6 4 2 0 Q1 Q2 Q3 Source: M etal Expert 2009 2010 World Steel Markets. weaker global steel product market will restrain the growth of coal quotations. in India domestic prices for flat products came up by $50-70/ t (depending product) in October. domestic prices are expected to increase there owing to the market revival. the expected resumption of China’s raw material imports being one of the reasons behind that. shipping fees will supposedly move further up.10 Source: M etal Expert from C anada from U SA In Q3. Metal Expert believes. Negotiations between Japanese steelmakers and Australian suppliers have resulted in the reduction of contract prices. Demand from Indian consumers is expected to go down in the short term due to sufficient stocks that were replenished thanks to active purchasing in second half of Q3. In addition. in October the world’s leading exporters of long and flat products decreased prices by some 3-10%. Baltic Dry Index (shows the changes in freight rates on major trade routes) rose by 11% from late September to 2. which will also propel freight rates. In the second half of October. The return of China to the market in mid-October pushed up demand in the spot market for coking coal thereby enabling exporters to raise prices.719.10 O ct.10 Jul. Hence. demand for steam coal transportation will strengthen ahead of winter. Q4 prices for highquality Australian coal have been cut by 7% to $209/t FOB. After the holidays are over in China. coal production will probably reduce.10 Oct. to $225-228/t FOB. in Japan and Europe particularly. In January. average monthly prices In the first half of October. In a short term. demand for domestic products declines Differe nce betwee n import and domestic coking coal prices in China from Australia 50% 40% 30% 20% 10% 0% Jan. Back to top In China. Therefore. which will affect coking coal consumption. India and China (purchasing rather large amounts of coal in the spot segment) still enjoy rather favourable conditions. In particular. steel products suppliers will attempt to raise prices again in the run-up to the Christmas and New Year holidays. spot quotations for coking coal will start rising. down from $50-80/t recorded in H1. gradual improvement of the situation in steel product markets coupled with the prospective development of long-term contract prices will prop up demand and quotations.10 Apr. the market’s demand for imports has improved. however. some mines may be flooded. transportation by large-tonnage vessels from Australia to the Far East cost around $12-18/t. those for semi-soft coking coal – by $16-20% to $138-145/t FOB. Due to the fall in Q4 contract prices. In December. which will buoy prices for raw materials. The deterioration in most steel product markets will depress coal consumption.Analysis Coking coal Coking coal prices are going up Global coking coal spot prices Sep. In particular. $/t. in H2 steel product output declined in the majority of countries as compared to the first six months. Unless the weather improves soon. As of today.10 EXPORT PRICES (fob) Australia (Queensland) 217 226 Source: Metal Expert.

Coking coal Statistics PRICES Australia (Queensland) USA Coking coal spot prices in world major markets export export fob fob Oct.10 May.10 Oct.10 Jun.10 217 212 Oct. average monthly prices * .10 Japan Netherlands/ Belgium Japan 11 34 14 14 35 15 13 29 15 9 26 14 8 27 14 14 28 14 12 25 13 Source: Metal Expert.data as for the first two weeks of the month Global freight rates at coking coal shipments Vessel type Loading port Country Discharging port Coking coal Capesize Queensland Australia ports of Japan Panamax Queensland Australia ARA Panamax Vostochny Russia ports of Japan Country Apr. October.09 150 Jun. 2010 . $/t Back to top 36 © Metal Expert +38 0562 39 88 50 World Steel Markets.10 Sep.10 Jul.10* 218 213 Source: Metal Expert.10 Aug.10 236 218 Jul.10 225 215 Aug. $/t.10 215 211 Sep.

3 337.: cars.8 1245.5 -11.2 569. Conference Board.4 390.0 547. billion kW/hour incl.8 2001.2 Aug.3 295.3 3217.09 1705.3 151. 1985=100 Production of motor vehicles. ‘000 pcs incl.5 87.9 Jan-Aug 2010 11847. ACEA.5 133.7 340. 2005=100 Consumer Confidence Indicator Motor vehicle registrations in EU-25+EFTA-3.7 6.8 Sources: NBS.8 47.: agriculture industry and construction service industry Consumer Confidence Index Jul.3 50.4 2049.1 -20.3 -26.4 1067.5 149.10 184. cars. Eurostat.0 598.9 324. BLS.1 172.8 85.2 377. mt electricity production.7 1206.10 175.5 10720. 2003=100 Consumer Confidence Index.1 Aug.5 5919.09 1166. CNY bn incl.3 Jan-Aug 2009 9321.09 109.7 243.9 Jan-Aug 2009 109.9 39.0 Jan-Aug 2009 171.4 Aug.6 831.: cars.8 72.as the sum Back to top World Steel Markets.5 610.6 55.9 106.9 17.0 164. 1985=100 Construction indices building permits.2 538.0 833.1 4507.3 % change per month -3% -10% -11% 3% 0% % change per month -1% 2% 1% 3% 5% % change per month 0% 4% 2% 11% 38% 42% 37% % change per month 0% 19% -31% -32% % change per month -20% -20% -19% -35% -20% % change per month 1% 0% -27% -39% 3% Aug.0 5104.5 Jan-Aug 2010 6399.7 1241.2 832. 1982=100 Consumer Confidence Index.9 81.7 Jan-Aug 2010 140997.3 267.4 23.0 931. ‘000 pcs Japan Production of motor vehicles.7 71.6 5529.9 % change 10/09 33% 60% 27% 37% 6% % change 10/09 27% 17% -1% 1% -2% % change 10/09 7% 29% 8% 10% 57% 52% 61% % change 10/09 3% 49% -2% -3% % change 10/09 38% 39% 34% 38% 50% % change 10/09 8% 7% 31% 20% 38% Production in steel consuming industries motor vehicles. OPEC indices and prices in “year-to-date” columns are given as average monthly. JAMA. mt Fuel and energy industry performance crude oil production.3 389.6 Aug.10 113.10 866.0 559.0 1178.8 17.2 Aug. others .4 107.0 1005. ‘000 pcs Price for Brent Crude Oil. TURKSTAT.10 2113.3 29.7 2255.4 -13.0 4796.1 35. cars. Census.9 Aug.5 -13.5 74.8 16.3 344.4 7936.8 1211.5 1887.10 690.4 995. 2010 © Metal Expert +38 0562 39 88 50 37 .7 935.4 61.6 Aug.09 571.2 465.9 Jan-Aug 2009 159. ‘000 pcs cement.1 Jan-Aug 2010 183. ‘000 pcs lorries.1 706.6 280.2 9604.8 746. billion kW/hour USA Producer Price Index (PPI).3 30.4 102.9 Aug.8 Aug.7 594. ‘000 pcs EU-27 Industrial Producer Price Index.09 175.7 3987. 000 pcs Total of motor vehicle exports.8 4660.5 54.0 513.7 101.10 2181.3 Aug.8 726.9 5780.9 6.5 53.0 3243.2 Jan-Aug 2010 112.10 1331.2 Jul.10 1342. ‘000 pcs buses.1 799.Macroeconomics and prices Macroeconomic indices of biggest economies China Investments in fixed assets.7 Jan-Aug 2009 4635. ‘000 pcs Turkey Producer Price Index (PPI).0 710.1 2740. ‘000 pcs lorries.6 Jul.10 113.10 184. thermal power plants.5 2221.8 51. WARD.8 493.5 83.4 275.6 79.2 77.2 3082.3 71.9 2718.3 Jul. October.6 42.7 422. $/b Jul.3 Jan-Aug 2009 106013.0 4371.1 9307.1 Jan-Aug 2010 172.3 4859.0 167. ‘000 pcs incl. 000 pcs incl.5 133.2 110.8 Aug. 000 pcs housing starts.5 87.10 173.5 10484.0 54.6 89.8 9.5 596.2 51.4 679.2 Jul.7 107.2 76.0 585.2 327.09 160.4 245.8 220. ‘000 pcs incl. 000 pcs Production of motor vehicles.0 541.

10 fob West Coast fob fob Rotterdam fob Black Sea c&f c&f South Korea fob Far East fob Black Sea c&f c&f (US Gulf ports) cpt (incl.10 Jul. VAT) c&f c&f c&f fca Shanxi (incl. VAT) c&f fob Black Sea fob Black Sea exw exw c&f c&f Anzali c&f Dubai fob exw c&f US Gulf exw 374 397 348 347 399 430 484 502 506 508 126 169 175 184 273 500 470 240 603 622 523 644 644 629 578 579 619 585 543 551 523 595 686 582 683 678 587 576 611 624 576 631 643 649 698 677 650 724 673 611 637 649 741 683 749 739 739 760 758 324 327 287 305 323 382 434 448 461 451 112 151 156 156 267 475 400 236 585 505 453 604 533 510 524 499 558 520 483 497 453 550 663 507 641 651 533 535 556 566 529 577 598 587 653 608 637 600 567 544 644 641 636 590 628 710 708 653 728 323 318 315 305 346 366 423 425 443 445 110 135 142 135 256 453 400 225 563 505 486 577 533 521 543 526 543 537 500 516 486 528 646 517 620 582 544 544 567 569 556 588 566 587 632 617 625 610 576 545 612 610 606 585 637 669 677 631 665 363 362 364 343 397 395 438 454 446 456 119 155 165 154 251 435 330 215 529 524 545 555 560 544 582 609 533 594 557 554 545 506 685 576 683 581 593 598 630 622 580 590 604 625 643 643 639 642 598 571 606 567 603 609 648 665 665 634 650 371 365 369 361 400 410 459 465 485 473 122 149 158 147 257 446 330 217 553 556 557 583 561 575 588 639 558 598 574 561 557 532 713 596 683 602 606 610 653 636 633 651 620 638 656 625 652 672 623 593 595 586 639 658 665 674 678 655 649 Oct. VAT * . 2010 .10 Jun.5%) import from India China (Fe 65%) import from Brazil China (Fe 62%) import from Australia Coke China domestic market China export Russia export coking coal Australia export Slab Brazil export Russia export CIS export USA import Far East import EU import Billet Far East import Iran import USA import UAE import Turkey export Russia export Russia export Brazil export China export Rebar Ukraine export Russia domestic Ukraine domestic Turkey export Turkey domestic Iran import UAE import Italy export Italy domestic China export USA import USA domestic HRC China export China domestic Far East import from CIS Russia export Ukraine export Russia domestic Ukraine domestic Turkey import from Russia Iran import UAE import EU export Italy domestic USA import USA domestic average monthly prices. VAT) fob daf Ukrainian border fob fob fob Far East fob Black Sea c&f US Gulf c&f from CIS c&f c&f from CIS c&f Anzali c&f US Gulf c&f Dubai fob fob Far East fob Black Sea fob fob fob Black Sea exw exw fob exw c&f Anzali c&f Dubai fob exw fob (BS4449 grade) c&f US Gulf exw fob dd Shanghai (incl.10 Sep.10* 363 359 350 361 390 393 448 448 483 448 124 148 158 153 261 450 330 218 553 560 520 583 561 580 574 600 568 569 535 546 520 545 710 565 690 604 581 595 613 581 608 651 625 608 678 633 651 661 620 590 602 594 648 655 683 700 713 660 638 Back to top 38 © Metal Expert +38 0562 39 88 50 World Steel Markets. $/t.Prices Spot prices in major world markets Steel scrap USA (HMS1) export Japan (HMS2) export EU (shredded) export Russia (3À) export Turkey (HMS1&2 (80:20)) import from USA Far East (HMS1) import from USA Pig iron Russia export Russia export Far East import USA import Iron ore China (Fe 64%) domestic market China (Fe 63. excl. October.10 Aug.data as for the first two weeks of the month Source: Metal Expert May.

. . . . .karpenko@metalexpert-group. . . . .com Copyright: © Metal Expert All rights reserved Coking coal spot prices in world major markets . . . . . . . . . . . . . . . . . . . Russia v. .metalexpert-group. . .com This document is for information purposes only. . . Markets. . . . . . reprinting or further distribution is in violation of copyright law. . . . . . . . . . . . .com +38 056 370 12 07 (ext. All rights reserved. . . . . .pupchenko@metalexpert-group. . . . . . . . . . . . . graphic. . . . . . . Copyright notice: © Metal Expert. . 1994-2010. . .com Metal Expert USA 2470 Hodges Bend Cir. . . . . . . . 5 Global long products trade structure . . 36 Macroeconomic indices of biggest economies . Naberezhna Peremogy. . . . . . . . . . . . . . . . . . . . . . in any form by any means is only allowed while having a preliminary written approval of the copyright owner. . . . . . . . . . . . . . . . . . . . . . . . . . copying. . . . Moscow. . . . . . . . . .. . . . . 14 Global flat products trade structure . . . . . . . . . . . . . . . . . . . . . . Global non-agglomerated iron ore market structure . . . . . . . Resending. . . . . . Head of Sales a. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Metal Expert’s monthly analytical reports: Raw Materials CIS Coal Ferro-alloys Flat Products Long Products Tubes and Pipes www. . 10 Global square billet trade structure . . . . . copying. . . . . . .com Offices Metal Expert Ukraine 48b. . . USA s. . . . . . 30 30 31 32 33 World Steel Markets Published by Metal Expert Clients should address all inquiries and proposals to Andrey Pupchenko a. . . . . . . . TX 77479. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ukraine a. . . . . . . . . . . . . . . . . . . . . . . . . Dnipropetrovs'k. The information contained in this document has been compiled from sources believed to be reliable. . . . . . . . 21 Global steel scrap market structure . . . . data. . . . . . . . Unauthorised and / or unlicensed resending. 26 Global pig iron market structure . .karpenko@metalexpert-group. . . . . . . .sadikhov@metalexpert-group. . . . . . . . . . 36 Global freight rates at coking coal shipments . . . . . . . . . . .volodarsky@metalexpert-group. . 18 Steel scrap spot prices in world major markets . . . . .com +38 0562 39-88-50 www. . . . 22 Pig iron spot prices in world major markets . . . . . 49094. Global agglomerated iron ore market structure . . . . . . . . 37 Spot prices in major world markets . . . . 14 Flat products spot prices in major world markets . . . 21 Global freight rates at steel scrap shipments . . Volokolamskoe shosse. 18 Global slab trade structure . . . . . . . . . . . . 5 Long products spot prices in major world markets . . . . . . . Global freight rates at iron ore shipments . . reprinting or further distribution of Metal Expert 's publications or its parts. . . . . . . . . . . . . . . 6 Billet spot prices in major world markets . . . . . . Prices • Monthly Analysis • Forecasts • Research • Consultancy List of tables Long products prices forecast in major world markets . . .Metal Expert • News. . . . Metal Expert Research cannot be made liable for any loss no matter how it may arise. . . . . . . . . . . . . . . . . . . .com Metal Expert Russia 73. . . . . . . 10 Flat products prices forecast in major world markets . . . 26 Global freight rates at pig iron shipments . 27 Chinese iron ore concentrate spot prices dynamics .metalexpert-group. Chinese non-agglomerated iron ore market structure . Sugar Land. . . . . . . . . . . . 15 Slab spot prices in major world markets . . . . . . . . . . . . . . . . . 160) +38 056 370 12 03 Subscription: Anna Karpenko. . . . . . . . . . . . . . . . . text. . . . . . .