The steel stock group has had a huge rally from the recent low point in February 2016, just following the remarkably calamitous HRB price decline on the world market in December 2015 (with the price falling to about $270 per tonne or far below the marginal cost of the median steel mill). Also, in early 2016, the export price was still near the lows and the mills were not yet filing an avalanche of trade suits against the Chinese mills.
From the low point, the composite Global Steel Group Index is up 84%. For individual countries, Chinese steel stocks are up 88%; Japanese 263%, USA 95%, Far East 61%, Western Europe 129%, Russian 103% and Brazilian 387%.
As of mid-March 2018, a global steel shortage is in effect for hot-rolled band, with the average export price at $640-650 per tonne, FOB the port of export. The export price in February 2016 was just $278 per tonne, FOB the port of export. Versus the global steel stock rally of 84%, the HRB export price is up 132%.
Interestingly, the Global Steel Group Index peaked in May 2008. Just two months later, in the midst of a remarkably severe steel shortage from a price point of view, the HRB export price for several weeks spiked to about $1,150 per tonne, FOB the port of export.
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