Baoshan Steel lowers HRC prices for Jul by $15/t
Source: Mysteel
Jun 11, 2019 17:30
The three works are the Baoshan works in East China’s Shanghai, its Dongshan works in South China’s Guangdong province and Meishan in East China’s Jiangsu. The company’s Qingshan plant in central China’s Hubei province does not produce carbon steel HRC.
“Nearly 80% of the company’s products are directly sold to downstream users,” explained a market insider in East China. “However, as the leading flat steel producer, Baoshan Steel’s price policy indicates the overall sentiment of China’s flat steel market. Actually, HRC prices had softened since last month but steelmakers wanted to hold onto prices to ensure margins at that time.”
Over the past month, Mysteel’s national average price for Q235 3mm HRC declined by a significant Yuan 183/t on month to reach Yuan 3,932/t including the 13% VAT as of June 10.
“Baoshan Steel’s move is within market expectations. The shrinking downstream demand could not help prop up prices and traders also decreased prices to attract buyers but there was little effect,” he added.
Another steel trader in Shanghai in East China agreed. “Thanks to the comparatively firm demand from construction projects, the trading of construction steel remains stable, but that of flat steel saw significant declines as downstream demand has shrunk markedly,” she said.
Besides, market insiders expected that steelmakers would not lower their production in the short term given the sustained profits they’re earning, a move which could also dampen prices.
The margins on HRC among the 91 integrated steel producers Mysteel regularly monitors reached Yuan 145/t on average over April 26-May 25, down by Yuan 141/t on month, as Mysteel reported.
Written by Anna Wu, wub@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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