The healthier profit margins thanks in part to the increase in finished steel prices saw most steelmakers continue to energetically procure steel scrap, a Shanghai-based scrap market source observed. “Over the past week, some steel mills kept on raising their offers for scrap to secure larger quantities,” she observed.
The uptick in procurement saw steel scrap stocks at the 61 Chinese blast furnace and electric-arc-furnace steel producers under Mysteel’s regular survey increase for a second week by another 109,800 tonnes or 5.1% on week to 2.25 million tonnes as of May 14 – sufficient to sustain the mills for 10.8 days of consumption, 0.1 day longer than the prior week. However, the tonnage was still 25.3% lower on year, according to Mysteel’s data.
“Since the beginning of last week, the higher bids the mills were tabling encouraged more scrap suppliers to speed up their pace of delivery. However, as scrap supplies – especially those of some premium quality grades – remain tight, scrap dealers held off selling during the rest of last week to wait for higher prices,” she added.
As of May 22, the daily delivery volume of steel scrap to 15 Chinese steel mills including both BF and EAF producers averaged 4,687 MT/day, down 18% from last Monday, according to Mysteel’s latest survey.
Also as of May 22, China’s national average price of HRB 400 20mm dia rebar had increased by RMB 108/MT on week to Yuan 3,799/t and including the 13% VAT, faster than the pace of the rise in scrap prices, according to Mysteel’s assessments.
This article has been published under an article exchange agreement between Mysteel Global and SteelMint Research.
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