Reduction in supply and increase in demand especially from China have pushed steel and iron ore price to multiple year's high in 2021.
China's steel rebar price has reached CNY5500/T (~USD850/T) recently, up more than 60% in one year.
Listed upstream steel companies such as Ann Joo, Lion Ind, CSCSteel & Masteel should benefit from higher selling price of their end products.
Downstream steel players have to endure higher cost due to high steel price. However, they can increase the price of their products since steel price has gone up.
For a period of time, they can enjoy super profit margin by utilizing raw material bought earlier at low price and sell at current high market price.
There are a lot of midstream & downstream steel companies listed in Bursa Malaysia, the long list includes Astino, Atta, AYS, Chinwell, Choobee, Chuan, Dynacia, Emetall, Engtex, Hiaptek, KSSC, LeonFB, LSteel, Lysaght, Melewar, Mycron, Pantech, Prestar, SKBShut, Tongher, WZSatu, YKGI, YLI etc.
As the world's largest aluminium producer, China increased its import of aluminium last year and even turned net importer in 2020.
The only listed upstream aluminium smelter in Malaysia is Press Metal. Other mid to downstream players include PMBTech, LBAlum, PA and Alcom etc.
All of them have registered much improve financial results in their most recent quarters. How long can this spectacular result persist?
Without exception, tin price also experienced a surge in price since the pandemic mainly driven by China demand.
Tin price has increased 100% from USD15,000/T in mid 2020 to USD34,000/T now, surpassing its historical high of ~USD32,500/T in 2011.
Johotin & Canone who manufacture tin cans have to endure a higher raw material cost though.
Recently copper price has soared past historical high of USD4.5/lbs (USD9,920/T) in 2011. It has gained more than 100% in one year, and has surpassed USD4.75/lbs (USD10,700/T) recently.