China’s steel exports may increase slightly on month in September, mainly due to the recovery in the global steel demand and steel production including re-rolling as well as the narrowing price gap of the Chinese export prices against the competitors, according to Mysteel’s monthly research report on September 10.
The data released by the World Steel Association (WSA) up to July indicated the slow recovery in the global steel market, as steel output outside China totaled 59.34 million tonnes in July, down 16.5% on year but up 3.9% on month, and the apparent steel consumption outside China totalled 61 million tonnes in July, down 19.8% on year but up 3.3% on month, Mysteel calculated.
Better steel demand and surging steelmaking raw material prices including iron ore and scrap in the world saw the global steel prices up too recently, which has narrowed the gap against higher steel export offering prices from China, enabling the Chinese sellers to ink some deals, Mysteel Global noted.
The price gap between China’s offering prices of SS400 hot-rolled coil against India’s HRC of equivalent quality, for example, narrowed to about $7/t at the end of July from $21/t at the start of June, which had largely moderated China’s disadvantage in the export market, according to Mysteel’s assessment. Steel export deals signed in July will be delivered in September.
The offering price of India’s HRC was assessed at $468/t FOB on July 31 against China’s SS400 HRC offering price at $475/t FOB North China’s Tianjin port, according to Mysteel’s data.
Until August, China’s actual steel export volume showed no signs of recovery, with the tonnage at 3.68 million tonnes or a new low since January 2013, down 12% on month or 26.6% lower on year, and over January-August, the export volume totalled 36.6 million tonnes, down 18.6% on year or steeper than the 17.6% on year for the first seven months, according to China’s Customs statistics.
Over May-July, the key importers of China’s flat steel products all posted two-digit on-year declines, with the volume to South Korea down 31-47% on year and the tonnages to the ASEAN countries and Japan fell 14-35% and 11-25% respectively on year, Mysteel noted.
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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