Chinese Steel Market Highlights-Week 12,2018

This week Chinese steel prices witness sharp downturn amid falling futures and prices in the domestic market. US decided to impose a 25% levy on up to USD 60 billion in annual imports from China. Meanwhile trade tensions with USA has created panic collectively affected nation’s domestic and export market.Flat Steel and Rebar export offers showed correction since the beginning of the week.Coking coal offers also declined marginally over tedious demand from China

Chinese spot iron ore prices fell sharply – China spot iron fines prices fell sharply falling decline in futures market. Iron ore fines (Fe 62%) index closed at USD 64.05/MT, CFR China by the end of this week, down by USD 7/MT W-o-W.

Spot pellet premium declined to USD 44/MT, CFR China. Spot lump premium was assessed at USD 0.18/DMT, CFR China.

Iron ore inventories at Chinese major ports increased by 0.75% W-o-W to 160.38 MnT.

Coking coal offers decline amid subdued demand from China- Australian coking coal offers continues to show downtrend owing to over supply and subdued demand from China.Since Chinese mills have reduced their operating rates of the steel plants which in turn reduces the consumption of the coal.Thus, reducing imports of coking coal from China.

Currently,Premium HCC prices was assessed at around USD 207.5/MT FoB Australia,s.Last week the offers were heard at USD 215.75/MT FoB basis.

Chinese billet domestic offers fell by USD 22 yesterday – Spot billet (150*150mm, Q235) prices in Tangshan tumbled sharply and stood at RMB 3,440/MT (including 17% VAT) by the end of the week, registering a D-o-D fall of RMB 140/MT (USD 22).

However Chinese billet export offers are assessed at USD 525-530/MT FoB China.

Chinese HRC export offers decline over weakening domestic market -Chinese HRC export offers moved down significantly amid falling steel prices in the domestic market.Also downturn in futures market along with trade barriers with USA after imposing tariffs resulted to decline in HRC export offers from China.

Currently Chinese HRC price assessment is in the range of USD 580-590/MT,FoB China.Payment are made on letter of credit basis for 1,000-10,000 MT.

Meanwhile prices in the domestic market are gauged at RMB 3,760 – 3,800/MT ,D-o-D basis in Eastern China (down by RMB 120/MT) D-o-D basis and RMB 3,710 – 3,740/MT (down by RMB 160/MT) in Northern China.

Major mills in China are offering HRC at USD 580-590/MT FoB basis,however amid bearish sentiments in nation’s domestic market,few overseas buyers have started withdrawing their export orders.

Chinese Re-bar export offers move down over falling futures-Nation’s re-bar export offers have registered decline amid falling futures.Also trade tensions with USA lead to fall in rebar export offers from China.

Currently,nation’s re-bar export offers are at USD 555-565/MT on China.However market participants are expecting the prices to be lower side which is around USD 540-545/MT FoB basis.

Meanwhile prices in the domestic market are heard at RMB 3,500-3,580/MT ,D-o-D basis decline by RMB 110-120/MT (Eastern China) and RMB 3,750-3,780/MT decline by RMB 80/MT(Northern China).

Chinese Iron and Steel Prices Week 12

Source-SteelMint Research