Shagang’s long steel down $23/mt for late Aug

China’s Jiangsu Shagang Steel has lowered rebar prices for late-August (Aug 21-30) deliveries by CNY150/mt ($23.15/mt) from mid-August. While listed retail prices are unchanged for other finished flat steel products including HRC.  

Earlier, the steelmaker had reduced prices by CNY200/mt for long products for mid-Aug deliveries following softening domestic demand.  

Long steel

After registering successive drops since late May, the listed price of rebar has been revised upwards for mid-August deliveries. Rebar (HRB400,16-25 mm) offers dropped to CNY5,470/mt ($868/mt) ex-works late-August deliveries, down by CNY150/mt from early August.

Offers for wire rod (HPB300, 8mm) remained unchanged at CNY5,810/mt ($897/mt) ex-works, inclusive of 13pc VAT.

Inventories of rebar across Chinese steelmakers and social warehouses stood at 11.36mn mt on August 19, down 121,000mt or 1.1pc from a week ago.  

Shagang steel’s retail prices for late-August shipments

Semis

In the domestic market, Q235 150mm billet prices fell by over CNY200/mt in ten days amid falling raw material prices. Chinese billet prices dropped to CNY4,930/mt ex-Tangshan, including VAT on August 24. Prices however were up by CNY20/mt from a day prior.

In the overseas market, China was absent from bulk purchases while Southeast Asian markets are taking longer to recover. Offers from Southeast sellers dropped as low as $635/mt fob or equivalent cfr levels below $650-660/mt cfr China.  

Flat steel

The steelmaker held its finished flat steel prices stable after raising them in early August amid firm global prices. Offers for HRC Q235B at CNY6,330/mt ($977) ex-works while Asian billet export offers dropped at $900-910/mt cfr Vietnam. Piling of inventories has added to bearish sentiments.  

Iron ore prices rebound fuelling hopes  

During the last two weeks period, the spot iron ore prices tumbled by over $30/mt to reach $128/mt cfr China. On Aug 24, the spot iron ore price index for 62pc Fe rebounded to $148.6/dmt cfr North China, up $12.10/mt in a day amid stricter production cuts. With the number of COVID cases falling to zero, ships started docking and other operations resumed at the various ports including Ningbo container port in China  

Following lowered consumption of ferrous scrap due to production cuts and falling steel prices, Shagang steel has successive reduced ferrous scrap bids thrice in August. The company lowered scrap buying price by CNY50/mt ($7.70/mt) for all grades, effective from Aug 19.  

Domestic scrap buying price for (HMS 6-10mm) dropped to CNY3730/mt ($574.36/mt). Other grades such as (HMS 10-20mm) and (less than and equal to 20mm) prices settled at CNY3760/mt ($578.98/mt), inclusive of 13pc VAT, delivered to headquarters at Zhangjiagang.  

($1=CNY6.47)

China’s Jiangsu Shagang Steel has lowered rebar prices for mid-August (August 11-20) deliveries by CNY200/mt ($30.8/mt) from early August. While listed retail prices are unchanged for other finished steel products, including wire rod and HRC. 

 

Earlier, the steelmakers had raised prices by CNY150/mt for rebar and CNY400/mt for HRC for early August deliveries on active domestic demand. 

 

Long steel

After registering successive drops since late May, the listed price of rebar has been revised upwards for mid-August deliveries. Rebar (HRB400,16-25 mm) offers dropped to CNY5,620/mt ($868/mt) ex-works mid-August deliveries, down by CNY200/mt from early August.

  

Offers for wire rods (HPB300, 8mm) remained unchanged at CNY5,960/mt ($920/mt) ex-works, inclusive of 13pc VAT.

  

Inventories of rebar across Chinese steelmakers and social warehouses stood at 11.48mn mt as of Aug 12, down 36,100 mt or 0.31pc from a week ago. 

Shagang steel’s retail prices for mid-August shipments
ProductsGradeCNY/mtChange
RebarHRB4005620-200
HRB5005920-200
Wire rodHRB40059500
WireHPB30059600
Hot-rolled coilQ235B63300
Q355B64600
Wide plateQ235B63000

 

Semis

In the domestic market, Q235 150mm billet prices fell slightly amid falling raw material prices. On Thursday, Chinese billet prices were stable at CNY5,110/mt ex-Tangshan, including VAT. Prices dropped by CNY70/mt from early August. 

 

In the overseas market, China continued to book billets at $700-705/mt cfr China, down $10-15/mt from late-July levels. However, demand from the ASEAN countries is subdued due to new restrictions to fight the resurgence of COVID in almost all major importing countries. Trades have almost halted in the last couple of weeks. 

 

Flat steel

The steelmaker held its finished flat steel prices stable after raising them in early August amid firm global prices. Offers for HRC Q235B at CNY6,330/mt ($977) ex-works while export offers were at $930-950/mt fob China. Piling of inventories has added to bearish sentiments. 

 

Iron ore prices tumbled on production cuts 

On Aug 12, the spot iron ore price index for 62pc Fe dropped to $161.45/dmt cfr North China amid stricter production cuts and potential economic slowdown. The resurgence of COVID cases weighed it down further as the Ningbo container port closed a terminal to control the virus. Since late July, spot iron ore prices have dropped by over $45-50/mt lowering steel prices. 

 

Following lowered consumption of ferrous scrap due to production cuts and falling steel prices, Shagang steel has successive reduced ferrous scrap bids twice in August. On Aug 10, the company cut ferrous scrap procurement prices by CNY50/mt ($7.7/mt) to CNY3,700-3,750/mt delivered Zhangjiagang works, including VAT.

 

($1=CNY6.47)

 

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