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Pressure on exporting of steel related products could mount in 2nd half

Pressure on exporting of steel related products could mount in 2nd half

Issue Time:2021-05-10
The condition of enterprise of steel pipes, fittings and flanges
Chinese foreign trade enterprises, especially the steel-related products exporters,  may face surging pressure in the second half of this year, due to increasing commodity prices, skyrocketing shipping costs, and a fluctuating foreign exchange rate.
We must notify customers of price increases in time, and remind customers to pay attention to the validity period of the price, and each order must be treated specially, the JS FITTINGS general director, Mr. Robin Yang Said.
JS FITTINGS produce and supply steel pipes, fittings and flanges to more than 30 countries. Because of the time differeence and projects demands, many customers can't arrange the payment in time, we have come out with many solutions to help customers keep the price.
The rising commodity prices and increasing shipping costs both weigh down on enterprises,Meanwhile, since many overseas manufacturers began to resume production earlier this year, the competition is also increasing.
Therefore, how to better serve customers and reduce each other's competitive pressure and cost input will be an important task this year.
Recent trends of the Chinese market
1. Prices of key commodities and industrial components increased between January and April. For example, the price of iron ore was up 58.8 percent compared with the same period last year, the price of copper rose 29.8 percent, and that of integrated circuits increased 18.9 percent, according to the General Administration of Customs data.

2. In addition, the cost of some shipping lanes saw a threefold to sixfold increase. For instance, the shipping cost of a container from Ningbo to New York skyrocketed, from $2,500 to almost $12,000, according to industry statistics.

3. The fluctuating foreign exchange rate also makes our contracts riskier, some emterprises have to resort to some financial derivatives to hedge risks.

According to Guan Tao, global chief economist of BOC International (China) Co Ltd, the two-way volatility of the exchange rate will continue this year, amid changing dynamics and a mix of factors.

Though China's foreign trade surged 28.5 percent year-on-year in the first four months of 2021, manufacturers are a bit conservative in their prospects for the rest of the year, and many of them could run out of raw materials soon.

Some manufacturers have gradually increased the sale price of their products, and more are strengthening their efforts to explore the domestic market.

We look forward to the stability of the entire market as soon as possible. At the same time, we are willing to unite with more partners to cope with the pressure of the market.

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