Chinese Steel Market Highlights- Week 23, 2018

This week Chinese steel market showed mixed sentiments in domestic market. In the beginning of the week steel prices registered increase. However by the end of week prices decline over weakening futures.

Spot iron ore prices increased sharply this week amid gains in futures. Flat steel export offers inched up marginally. Coking coal prices moved up amid increased buying from Chinese mills. Rebar export offers remain stable over dull buying.Meanwhile domestic billet prices edged up this week.

According to the recent data released by General Administration of customs, China, finished steel exports increase on monthly basis to 6.88 MnT in May’18, higher by 6% against 6.48 MnT a month ago.However on yearly basis the same decline marginally by 2% in May’18 against 6.98 MnT in Apr’18. Meanwhile in first five months of CY18 ( Jan-May) nation’s finished steel export volumes stood at 28.51 MnT, down by 17% as compared to 34.2 MnT in similar time frame of previous year.

Chinese spot iron ore prices increase – Chinese spot iron ore prices moved up throughout the week following increase in futures over mine explosion in China’s Lioning province. Fe 62% fines assessment increased from USD 63.85/MT, CFR China in the beginning of the week to USD 67/MT, CFR China by week close. Iron ore stock at Chinese major ports fell by 0.95 MnT to 161.03 MnT this week.

Spot lump premium moved up and was assessed at USD 0.195/MT, CFR and pellet premium fell slightly to USD 52.45/MT, CFR China.

China’s iron ore and pellet imports have witnessed an increase of 14% M-o-M in May’18. The imports recorded at 94.14 MnT in May’18 compared to 82.92 MnT in Apr’18, according to General Administration of Customs China. The imports took a forward leap due to strong steel margins.

Coking coal offers rise over increased buying from China- Seaborne coking coal prices showed an upward trend this week owing to resumption of full-fledged steel production in China.End of winter cuts in mid March has lead to robust in buying from China.

Thus, Coking coal prices are projected to increase further depending on the sustainability of Chinese buyers’. Meanwhile supply disruption in Australia due to logistical issues persisting in the Queensland coal belt area may keep coking coal prices supported in near term.

Currently,Premium HCC prices were assessed at around USD 197/MT FoB Australia.However, last week coking coal prices stood at 184.75/MT FoB basis.

Chinese domestic billet offers move up – Domestic billet prices in China edged up to RMB 3,740/MT (incld 17% VAT) for Q235 billet in Tangshan by week close against RMB 3,710/MT in week’s beginning.

Chinese HRC export offers rose marginally-Nation’s HRC export offers inched up slightly in the beginning of the week amid stability in domestic market.

Currently heard around USD 590-595/MT,FoB China. Payment are made on letter of credit basis for 1,000-10,000 MT.

Major mills in China were offering HRC export offers around USD 595-605/MT,FoB China.However no major deals concluded as the buyers are bidding on lower side.

Prices of HRC in the domestic market are gauged at RMB 4,300-4,320/MT (ex-works) in Eastern China and 4,220-4,240 /MT ( Northern China).

Chinese Re-bar exports offers remain largely stable-Nation’s re-bar export offers remain largely stable.

Currently,nation’s re-bar export offers are at USD 550-552/MT FoB China. However last week the offers are assessed at similar range.Bids from buyers continued to remain on lower side.

Meanwhile prices in the domestic market are heard at RMB 4,040-4,070/MT in (Eastern China) and RMB 3,910-3,950/MT in (Northern China).

Chinese Iron and Steel Prices Week 23

Source- SteelMint Research