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The growth of prices on world markets affect China and the rise in prices of raw materials

16 November 2016

The peak of the recession the global steel market experienced at the beginning of this year. And only now seeing a slow recovery from the crisis. In the beginning of this month price growth for steel and its derivatives was in the order of 45−65%. However, manufacturers began early to rejoice. Because, analysts say that future prospects are still unclear. Further market recovery in the first place will depend on the growth of the Chinese economy.

So, this spring, the Chinese government switched to a new approach to stimulate economic growth. This was involved both public and private investment. And this was the main impetus to the rise of the world market. Because of this, at the beginning of this half of the year, steel producers were able to significantly raise prices. Undoubtedly, next year, China will have a direct impact on the global steel market.

One of the reasons according to the world steel market from Korea — the country’s largest producer, consumer and supplier of the steel. The second factor is that outside China, almost no growth zones. In most countries there is a decline in steel consumption, due to the economic crisis. In addition to the DPRK, it is possible to allocate Turkey, India, Iran and Vietnam. The steel industry suffers from overcapacity. And the growth of competition in the market, stimulates, simple patronage.

While talking about significant and permanent increase in steel prices early to say. In the first place, has to recover the world economy. There is a possibility that next year there will be a decline in prices for coking coal. So the cost of steel products to decline again.

Initiated by the United States and the European Union on China anti-dumping investigation, can have some influence.

This month, some large companies have already noted a certain decline in income. In the European Union a marked downturn in the economy and the steel market. In this sector it is difficult to talk about the imminent restoration of this part of the world economy.

Last month, there was an increase in prices for many types of steel products. It is worth noting that in some sectors, market prices have risen by more than 10 percent. But unlike a price jump of Vienna, the reasons for this are rather speculative. Primary factor that had a significant role in the growth of prices. However, a number of matches which caused an increase in prices cannot durably affect them.

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