Wider Low, High Grades NO Electrical Steel Price Gap in Asia

Non oriented electrical steel price gap is expanding in Asia depending on grade. High grade product demand is increasing in China due to growing output of compressor with inverter under global energy saving trend. The demand for low grade product price would decrease due to lower cold rolled sheet price and oversupply condition with new comers. Japanese steel makers plan to set higher extra price on high grade product. The users including Japanese offshore transplants show sign to accept the price gap depending of the grades when their bid depends on the grade.

Chinese compressor makers increase production of higher efficiency products including inverter products. The trend increases Chinese demand for higher grade non oriented electrical steel with lower core loss. Chinese government encourages domestic industry to improve compressor quality under global energy saving trend. Chinese air conditioner compressor output could increase to 100 million units per year soon from around 80 million units in the largest market while the output is around 7 million units in Japan, according to an industry source.

Some Chinese makers launched non oriented electrical steel production along with the growing demand in China. However, only limited steel makers including Nippon Steel, JFE Steel, Baoshan Iron & Steel, Wuhan Iron and Steel and POSCO can make the high grade product in Asia. Baoshan Iron & Steel set high grade non oriented electrical steel price unchanged for domestic shipment for June while the firm reduced low grade product price to follow market price.