Share prices of steel producers in the Thai stock market continue to underperform the market as a plummet in global metal prices due to lower demand in the market casts shadow over manufacturers.
Data from Wind Information reveals a significant drop in China’s steel rebar prices, plummeting more than 20% to 3,208 Chinese yuan per ton since the beginning of the year amid sluggish demand resulting in lower metal prices overall.
Moreover, prices for China’s crucial steel component, iron ore, have also steeply declined by over 28% year-to-date based on FactSet figures. As the world’s largest steel producer, generating more than half of global output exceeding a billion tons annually, China’s market imbalance persists due to weak internal demand, affecting steel and iron ore prices negatively.
The absence of concrete interventions following China’s Third Plenum gathering has cast doubt on the recovery of the troubled property sector.
As the price of the world’s largest producer slowed down, negative sentiment also impacted prices in other countries as well, especially in the same region.
In the final week of July 2024, steel prices in Asia experienced fluctuations across various product categories. Slab and hot-rolled coil (HRC) prices decreased by 5.7% and 2.5% respectively compared to the previous month, averaging at $500 and $503 per ton, respectively. Conversely, cold-rolled coil (CRC) prices remained stable month-on-month at an average of $580 per ton.
Long steel product prices in the Asian market, including rebar, billet, wire rod, and H-beam, saw declines of 3.7%, 2.6%, 4.8%, and 0.8% respectively from the previous month. Average prices stood at $499 per ton for rebar, $493 per ton for billet, $495 per ton for wire rod, and $640 per ton for H-beam.
Raw material prices in the Asian import market in the last week of July 2024 recorded an increase of 2.5% for scrap, with prices at $415 per ton. On the other hand, hard coking coal and iron ore prices dropped by 5.9% and 2.5% respectively, averaging at $225 per ton and $117 per ton compared to the previous month, respectively.
Since January, the share price of G J Steel Public Company Limited (SET: GJS) slipped 9.52%. TMT Steel Public Company Limited (SET: TMT) dropped 26.9%, Tata Steel (Thailand) Public Company Limited (SET: TSTH) plunged 38.10% and Millcon Steel Public Company Limited (SET: MILL) fell 76.32%. Meanwhile, Thailand’s main bourse SET Index dropped 5.51% so far this year.
Still, MILL and GJS closed higher on Wednesday with a gain of 12.50% and 5.56%, respectively, while TSTH and TMT were flat.
