The Risk of Cold Rolled Silicon Steel Coil Trading Business Increased

According to the Shanghai steel market messages, due to the multi-faceted attack of the risks and pressures, the risk of cold-rolled silicon steel coil business is largely increased this year, especially large-scale steel trading company.

Shipbuilding Steel Coil for Sale

First of all, the pressure from the upstream steel mills: Due to the steel mills repeatedly raised the ex-factory price market "upside down" serious; unfair "buyout" agent weight of the steel trading business "out of breath", such as custom steel futures (forward contracts) is necessary to complete the annual amount of agreement, but also the monthly requirements in order indicators, the payment date by the steel mills have the final say, in a word, must fulfill the terms of the order contract, otherwise the "Price" recourse subsidies to discount, or even canceled. Steel mills as long as the receipt of the steel trading business payments, all market risk is fully transferred to the steel trading business, really "multi-site thanks to more set more losses".

Secondly, the steel trading business capital chain is quite fragile, repayment deadline steel trading business "of the year" on the 20th of each month, loan steel coil trading business only to large enterprises "tray" financing conditions are very strict, not only to contract, and to physical (cold-rolled silicon steel volumes) to the designated warehouse, experience, income (number) to confirm loans, redemptions must pass the funds to the account, in order to ship, "tray" financing the steel trading business to bear the delivery the library costs, transportation costs, interest, etc., as well as the downside risk of the market. Tray financing to increase the running costs of the steel coil trading business this year, "tray" financing the steel trading business is basically a "loss and more profit," tray "financing costs are too high, cannot be sustained for a long time.

Again, this year, the terminal downstream demand weak, the market waiting to see atmosphere, the listing price artificially high, transaction price", some downstream but also after delivery between the steel trading business competitive, and some steel mills increase direct supply, squeeze the share of steel trading business more and more narrow, steel trading business in the multi-faceted attack of "living space, especially the shortage of funds is a sword hanging over the head of the steel coil, plate, tube/pipes trading business, part of the steel in the second half of the year trading business "shut down, and turn the industry would not be surprised.