China’s Shagang Steel Raises Scrap Purchase Price by USD 12

Eastern China’s largest ferrous scrap consumer and EAF steelmaker – Shagang Jiangsu Steel group has lifted steel scrap purchase prices further by RMB 80/MT (USD 12) effective from 19th Dec. This is the second price hike the company has observed in Dec’18, after witnessing RMB 100/MT increase on last Thursday. Amid lowering scrap inventories and tight supply in the domestic market the steelmaker could have raised scrap prices.

Consequently, Shagang Steel is paying RMB 2,600/MT (USD 376) inclusive of 16% VAT for HMS (6-10 mm thickness) delivered to headquarter works situated in Zhangjiagang province in China, up RMB 80/MT as against the last report of RMB 2,520/MT on 13th Dec’18.

The prices for other grades of scrap also have moved up by around RMB 80/MT in this revision. Shagang is paying RMB 2,700/MT (USD 391) for HMS (thickness not less than 20 mm) while around RMB 2,500/MT for medium sized scrap (thickness 4-6 mm). New prices stand at around RMB 2,720/MT for charging scrap 1 and RMB 2,650/MT for HMS (thickness not less than 10 mm) inclusive of 16% VAT.

Following Shagang’s lead, other leading scrap consumers also intended to increase scrap inventories and raised scrap purchase prices by RMB 50-80/MT in eastern China.

China’s domestic rebar prices range bound amid less activities – Recent Rebar prices in eastern China reported at RMB 3,780-3,820/MT (USD 547-554), ex- Shanghai, down marginally RMB 20/MT after rising successively from earlier four days. While rebar export offers assessed at USD 480-495/MT, FoB China. Amid an outlook of softening demand stockiest remain hesitant to buy more and to build their inventories.

As per recent reports, China’s Ministry of Industry and Information Technology intends to remove 11 steelmakers from its list of qualified domestic producers for 2018. Chinese government efforts seriously to prioritize environmental protection thus, many steelmakers in environmentally sensitive regions have already invested heavily to ensure that their anti-pollution facilities meet the required standards and that their operations are sustainable.