GACC: China's Jan-Feb ferrous scrap imports slump 53% YoY

During February alone, the country's total imports of ferrous scrap stood at 11,977 tonnes, the lowest monthly level since November 2021, the GACC data showed. The widely-observed production halt among electric-arc-furnace (EAF) steel mills during the official Chinese New Year holiday in mid-February, plus the reduced cost effectiveness of steel scrap against hot metal, both caused steel scrap consumption to drop significantly last month, as reported.

By the end of February, the cost of making steel using steel scrap among integrated mills in East China's Jiangsu province averaged Yuan 2,703/tonne ($378.4/t) excluding the 13% VAT, higher by Yuan 31.5/t compared with using hot metal, according to Mysteel's assessment.

On the other hand, during the past two months steel scrap in international markets has remained more expensive than scrap collected and processed within China, even though the price spreads had narrowed recently, according to Mysteel's survey. This continued to dissuade domestic traders from buying overseas scrap in large quantities, Mysteel Global learned.

For example, as of February 29, the price of HS scrap from Japan, the foremost ferrous scrap exporter to China, was assessed by Mysteel at $378/t excluding the 13% VAT, higher by $9.7/t compared with the spot transaction price for 6-8 mm common carbon steel scrap in Jiangsu on the same day.

Last month, China's imports of ferrous scrap from Japan totalled just 5,507 tonnes, lower by a substantial 79.2% on year, according to the GACC data. During January-February, the import volume from Japan totalled 28,815 tonnes, accounting for some 56.2% of China's total imports of the commodity, the data showed.

Written by Anthea Shi, shihui@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com