Steel companies face the crisis of port congestion!

The Port of Los Angeles and Long Beach, the two major container ports on the US West Coast, have deteriorated due to recent congestion.

Last Friday, the two ports announced that they would extend night and weekend operating hours to increase port volume and alleviate port congestion.

The iron and steel industry was also affected. The industry pointed out that goods cannot be shipped and there is no way to negotiate without shipment. Therefore, many steel exporters risked a capital chain break.

Some domestic industry players pointed out that due to port congestion, exporting steel companies remained cashless, thus unable to purchase raw materials, which resulted in raw material importers accumulating inventories, which led to lower prices and creating a vicious circle.

The situation is also happening in other countries. For example, Indian hot rolled coils, which have occupied the Vietnamese market for a long time, have recently started to fade. The main reason for this was that Indian steelmakers were concerned about the liquidity of local steel companies as some buyers had insufficient LC.