Article: Coal supply shortage not likely to affect Malaysian steel mills

Source: http://www.steelguru.com/international_news/Coal_supply_shortage_not_likely_to_affect_Malaysian_steel_mills/186358.html

1) Correlation scrap metal price and coking coal prices
Australia, which supplies more than half of the world's coal exports, has been hit with massive floods that have hurt the production of the commodity, which is mostly sold to Asia's steel companies. However, Malaysian steel makers will still have to contend with slightly higher scrap metal prices.


According to some estimates, scrap metal prices have risen following the uptrend in coking coal prices to about USD 500 per tonne now from around USD 400 per tonne in December 2010.


Kinsteel uses scrap metal as its main raw material


2) Seasonal variations
Mr Ng Sem Guan steel analyst at OSK Research said in a recent report that steel product prices were expected to soften slightly in the coming weeks largely due to a slowdown in construction activities in view of the upcoming Lunar year celebrations