Global steel prices rallied this month. China saw both HR coil and rebar prices expand by 10% month-on-month. The rise means that Chinese HR coil is now more expensive than European HR coil. The last time we saw this was in April 2016 – a month when Chinese steel prices shot up over 20% only to quickly drop back in subsequent months. We expect history to repeat itself and the negative Europe – China spread will not be maintained. In the US, EU and China, the market is frothy – bolstered by sentiment. With prices elevated, global steelmakers are enjoying exceptional margins. They will still be enjoying large margins despite our forecast hefty price falls which we believe are due imminently.