Steel prices in the country witnessed an uptrend this week on the back of strengthening futures and decent domestic demand.
HRC export offers witnessed a rise following gains in the domestic market. Rebar export offers moved up slightly. Iron ore prices rose on the back of stricter pollution controls. Coking coal prices continued to remain stable for the second consecutive week.
China spot iron ore prices up during the week-
Chinese spot iron ore prices opened at $101.6/t this week, increased to $105.09/t towards the weekend amid a surge in futures.
As per data compiled by SteelHome consultancy, Iron ore inventory at major Chinese ports increased to 110.05 mn t as against $109.75 mn t assessed a week ago.
Spot pellet premium down w-o-w-
Spot pellet premium for Fe 65% grade pellets assessed at $10.25/t down by $ 7.65/t W-o-W. The rising port inventory and cheaper lump cargoes have reduced pellet procurement.
However, improving domestic demand in India is expected to witness an uptick in the prices in the longer term.
As per data compiled by SteelHome consultancy, pellet inventory at major Chinese ports increased to 8.7 mn t as against 8.1 mn t assessed a week ago.
Spot lump premium rises on narrowing spread between fines and lumps-
Spot lump premiums witnessed this week at $ 0.1130/dmtu. The rainy season in southern China raised complications in lump screening, with high moisture content. However, the narrowing spread between fines and lumps has improved end-users interest and a further drop in the lump prices could entice end-users to replace sintering fines with lumps.
Domestic billet prices rise significantly in the week-
This week, Chinese domestic billet prices closed with a significant rise of RMB 90, against last week’s closing. The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,390/t ($485/t) in Tangshan, inclusive of 13 % VAT.
Coking coal price continues to remain flat-
Seaborne coking coal prices have remained flat for the second consecutive week, on limited liquidity in the Chinese market and muted buying interest from India.
Chinese steel mills and traders had been largely refraining from procurement due to the exhausting import quotas and stringent customs clearance procedures at major coal-handling ports.
Meanwhile, Indian buying interest for seaborne coking coal has considerably weakened with most steel plants operating at lower capacity utilization levels and high inventory stockpiles.
Downstream demand from steel-buying sectors such as automotive, consumer durables, construction, and real estate remained subdued resulting in sluggish demand for coking coal.
The latest offers for the Premium HCC grade are assessed at around $115.25/t FoB Australia against $116/t FoB basis.
HRC export offers up on improving domestic market sentiments-
The Chinese manufacturers have increased their offers by around $5/t on the back of decent domestic demand. Also, the mills are not in a rush to export since mills can fetch better margins in the domestic market.
Domestic HRC prices also gained by RMB 110/t to RMB 3,850-3,870/t in contrast with RMB 3,740-3,760/t in the preceding week.
Also, the Chinese steel major Baosteel has announced a hike of RMB 100/t ($14) in prices of HRC, heavy plates, and HDGI.
Currently, the export offer stands around $450-460/t CFR China, which was $ 440-445/t a week ago.
Meanwhile, this week Chinese steel mill imported 40,000 t of HRC from India for Aug deliveries.
Rebar export offers increased slightly-
The domestic market gains propelled the mills to keep their export offers on the higher end. Also, the availability of cheaper materials from other exporting countries kept buying interest low for the Chinese origin rebar.
The current week rebar export offer stands at $455-465/t FoB China, which was $452-460/t a week ago.
Domestic prices also increased by RMB 50-60/t to RMB 3,570-3,590/t as against RMB 3,510-3,540/t in the previous week.
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