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China’s national price of HRB400E 20mm dia rebar assessed by Mysteel reversed up Yuan 45/tonne ($6.9/t) on day to Yuan 5,387/t including the 13% VAT as of July 23, as more provinces had requested local steel mills to reduce their crude steel production for the remainder of this year, which had lent support to domestic steel prices on probably less supply.
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Already lashed by heavy rains and flooding since Wednesday which have so far claimed 33 lives, Henan province in central China is bracing for more. The disruptions to manufacturing industries continue, Mysteel’s latest survey has found, with the local metallurgical community including steelmakers, raw materials suppliers and metal makers further halting their operations to avoid risks to safety.
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Chinese steel producers showed less interest in exporting steel last week amid mounting concerns that the central government may impose new export taxes, according to Mysteel’s latest weekly report. In the meantime, they opted to raise export prices by a large degree.
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Capacity utilization among the 126 blast furnaces in Tangshan city, China’s top steel producing city in North China’s Hebei province, continued to rise last week, jumping by another 7.1 percentage points on week, as local mills brought more furnaces back into operation after restrictions on them were eased.
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China’s national HRB400E 20mm dia rebar price, the indicator of China’s steel market performance, nudged up another Yuan 9/tonne ($1.4/t) on day to Yuan 5,276/t including the 13% VAT as of July 16, refreshing a nearly two-month high even though trading remained rangebound, indicating that market sentiment had been largely steady in the low steel consumption season.
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China’s domestic steel scrap will probably remain strong for the second half of 2021, as the tight supply-demand balance in the market will persist, according to Mysteel’s near-term market outlook.
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China’s steel export volume remained low over the week of July 3-9, mainly due to weak demand in the countries of ASEAN, the largest buyers of Chinese steel, according to Mysteel’s latest weekly report. The low prices in ASEAN were also responsible for China’s steel imports to pick up over the same period.
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Tangshan Q235 150mm square billet price, a barometer of China’s steel market sentiment especially for North China, rose further by Yuan 150/tonne ($23.2/t) on week to Yuan 5,020/tonne EXW and including the 13% VAT as of July 9, or having returned to the threshold of Yuan 5,000/t since June 15, though the market sentiment had been mixed with the downward pressure loitering.
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The Tangshan Q235 150mm square billet in North China’s Hebei province under Mysteel’s assessment surged by Yuan 110/tonne ($17/t) from last Friday to Yuan 5,130/t EXW including the VAT as of July 11, or the highest since May 21 thanks to the better sentiment in domestic market.
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Domestic coking coal prices in China have been steadily trending upward since mid-June, with Mysteel’s national composite coking coal price gaining Yuan 338.8/tonne ($52.3/t) on month to reach Yuan 1,714.7/t and including the 13% VAT as of July 7 – a new high since Mysteel launched this assessment in April 2018.
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After rising for the three prior months, steel scrap utilization in the crude steel produced by the 211 Chinese steel mills sampled in Mysteel’s regular survey shrank in June, reversing down by an albeit in tiny 0.29 percentage point from May to 26.84% on average. The survey samples integrated and electric-arc-furnace (EAF) producers, as well as those mills using both blast furnace (BF) and EAF technologies.
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Chinese steel export prices and trade both remain weak last week, with the price of China-origin hot rolled coil falling for the seventh week in a row. Market sources blamed the outflow of low-priced Russian steel products for the downward pressure on prices.
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The price of Q235 150mm square billet in Tangshan, North China’s Hebei province, rebounded last week after two weeks of steady falls, reversing up by Yuan 30/tonne ($4.6/t) on week to Yuan 4,870/t EXW and including the 13% VAT, according to Mysteel’s latest report. But market watchers warn that weakening fundamentals will exert downward pressure in the near term.
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The profit margins that China’s independent electric-arc-furnace (EAF) steelmakers are earning on their steel continue to be dragged down by rises in production costs and the continuous decrease in finished steel prices.
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Stocks of steel scrap including processed and unprocessed at China’s 293 licensed scrapyards have recovered 4.4% on month as of June 30, according to Mysteel’s latest survey, which was mainly due to the weakening in demand from the steel mills both for blast furnace (BF) and electric-arc-furnace (EAF) mills on their thinning finished steel margins while the betting on higher scrap prices among the scrap suppliers, market sources shared.
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Chinese steel export prices declined for the sixth week last week though at a faster pace than previously, due to weakening domestic market conditions and poor demand from the ASEAN region, the primary destination for Chinese steel exports, market sources indicated.
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Billet fundamentals in Tangshan, North China’s Hebei province, stayed weak with the latest curbs on local steel mills and steel re-rollers ahead of the centenary of the founding of the Communist Party of China (CPC) on July 1, Mysteel’s latest surveys showed.
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Chinese steel export prices continued to move down for the fifth week last week and export trade remained inactive as buyers held back on concerns about possible steel export tax adjustments, Mysteel’s latest weekly report shows.
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The Tangshan billet price, a barometer of China’s steel market dynamics, headed down last week, as downstream users were not active in buying in the face of growing sales pressure themselves, according to local industry sources.
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Imported iron ore stocks at China’s 45 ports under Mysteel’s weekly survey declined to a new five-month low of 120.9 million tonnes by June 17, or down for the third week over June 11-17 by another 2.8 million tonnes or 2.3% on week, mainly due to the slight rise in daily discharge volume and the long unloading time at some ports.
