Since 1st Jan’18, Shagang Steel in China has registered total price drop of RMB 160/MT (USD 25) for domestic scrap purchase price.
The largest ferrous scrap consumer in China, Shagang Jiangsu Steel group has cut its scrap buying prices twice by Chinese Yuan 50/MT (USD 8) once on Saturday and again today respectively (i.e. 13th and 15th Jan’18). As per latest price update, Shagang is now paying RMB 2,460/MT (USD 382) inclusive of 17% VAT for heavy melting scrap not lesser than 6 mm in thickness delivered to its works in Zhangjiagang Province in China.
Earlier to these price revisions, the company was fetching the same grade at RMB 2,560/MT (USD 398) including 17% VAT as per revision on 09 Jan’18. Thus the company has witnessed four consecutive price drops in first half of January month, through which Shagang Steel has lowered total scrap purchase prices by RMB 160/MT (USD 25).
Shagang Steel also cut the scrap purchase prices for HMS 1 scrap not lesser than 20 mm in thickness by RMB 100/MT in the latest price revision. Shagang is now paying RMB 2540/MT (USD 405) for scrap not lesser than 20 mm in thickness. While RMB 2360/MT and RMB 2230/MT for scrap with specification 4-6 mm and 2-4 mm width respectively.
Shagang steel has an annual production capacity of 31.9 MnT iron, 39.2 MnT steel and 37.2 MnT rolled products.
Chinese steel mills remain resistant towards scrap purchase at high prices amid ample inventories –
Shagang Steel has been lowering the scrap buying prices successively in parallel with continuously falling domestic rebar prices in China. Sources are of the view that many of the steel mills have now turned resistant for scrap purchase at high prices amid enough inventories already available to them. Following Shagang’s price cut, few other major mills in eastern China have dropped their scrap buying prices.
Chinese domestic rebar and billet prices also have fallen in a week’s time. Domestic billet prices in China are today assessed at RMB 3,490/MT against last week’s assessment of RMB 3,550/MT (including 17% VAT). On similar lines, domestic rebar prices in China have also declined by RMB 60-100/MT.
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