Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

China’s Shagang Steel raised finished long steel prices for end-July (July 21-30) deliveries by CNY200-250/mt ($30-39/mt) from mid-July, while keeping finished flat steel prices unchanged for one month from early July listed prices.  


Long steel

After registering successive drops since late May, the listed price of rebar has been revised upwards for mid-July deliveries.  

Rebar (HRB400,16-25 mm) offers rose to CNY5,670/mt ($877/mt) ex-works for end-July, up by CNY250/mt from mid-July (11-20).  


Offers for wire rods (HPB300, 8mm) rose CNY200/mt for end July shipments to CNY5,900/mt ($912/mt) ex-works, inclusive of 13pc VAT.  


Inventories of rebar across Chinese steelmakers and social warehouses stood at 11.37mn mt on July 22, down 0.7pc from a week ago. 

In the domestic market, Q235 150mm billet prices rose from early June, due to high raw material prices. On Thursday, Chinese billet prices were stable at CNY5,180/mt ex-Tangshan, including VAT. Yet prices rose by CNY160/mt from ten days prior. 


Driven by increased rolling requirements amid production cuts, Chinese mills actively resumed billet imports pushing prices by $15-20/mt from mid-July levels to $715-720/mt cfr China.

Shagang Steel’s retail prices for end-July shipments
ProductsGradeCNY/mtChange over mid-July  
Wire rodHRB4005900200
Hot-rolled coilQ235B59300
Wide plateQ235B60000


Flat steel

The steelmaker held its finished flat steel prices stable following global cues. Offers for HRC Q235B at CNY5,930/mt ($918) ex-works while export offers rose to $980-1,000/mt fob China, higher by over $50/mt from mid-July levels. Piling of inventories has also added to bearish sentiments. Demand for flat steel is mixed amid production cuts by automakers.  


HRC stocks across social warehouses and steel makers rose by 68,100mt or 1.71pc from the prior week to 4.06mn mt in the week ended July 22.


On July 20, HRC futures surpassed the CNY6,000/mt mark, while spot prices rose by CNY220/mt to CNY5800-5,850/mt ex-works from mid-July. Russian steelmakers were forced to reduce inventories at a discount before August 1 to avoid 15pc export duties. Indian prices too were under pressure as the domestic demand remained affected.  


Raw material prices down on demand concerns 

Chinese spot iron ore prices had risen to above $220/mt cfr but is under pressure amid government policies and uncertainties over export taxes. On July 22, spot iron ore 62pc Fe fell by around $13-14/mt within two days to reach $208/mt cfr north China on-demand concerns.  


Amid tightening supply, Shagang Steel announced a price hike on July 20, lifting prices by CNY80/mt its ferrous scrap procurement. Prices for HMS 6-10mm in Jiangsu province were at CNY3,830/mt delivered Zhangjiagang works, including VAT. Mirroring sharp drops in iron ore prices, scrap prices are likely to drop. A few mills in Shandong province targeting prices lower by CNY300/mt than current levels.  


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