- HRC prices remain stable, rebar rises w-o-w
- Benchmark iron ore fines spot prices up $3/t
China’s steel market displayed a mixed performance this week, with Shanghai Futures Exchange (SHFE) prices trending upward. Notably, domestic prices of hot-rolled coils (HRCs) remained stable and rebar rose w-o-w, while billet prices also saw a weekly increase. In the raw materials segment, spot iron ore prices rose, but coking coal stayed firm over the week.
The China Iron and Steel Association (CISA) revealed that the total steel inventory at key Chinese enterprises stood at 16.91 million tonnes (mnt) in mid-March 2025. Inventory levels increased by 660,000 tonnes (t) or 4.1% against 16.24 mnt in early March 2025.
1. Iron ore spot prices rise by $3/t w-o-w: The benchmark iron ore fines price increased by $3/t w-o-w to $105/t CFR China on 27 March supported by optimistic market sentiment, despite low trading activity. Reports suggested, the recent 10% production cut from steel mills has boosted market sentiment, leading to expectations of further cuts and improvements in the downstream steel market. Some regions in China have announced voluntary production cuts, but the overall impact on output is minimal, and hot metal production is still rising.
a) Spot pellet premium falls w-o-w: Spot pellet premium for Fe 65% grade pellet decreased by $0.2/t w-o-w to $12.90/t CFR China on 26 March.
b) Spot lump premium stable w-o-w: Spot lump premium remained stable w-o-w at $0.1470/dmtu on 27 March.
2. Coking coal prices inch up w-o-w: Australian coking coal prices remained stable after witnessing a marginal hike earlier in the week on the back of steel price support and slight demand improvement. PHCC was assessed at $169/t FOB Australia.
3. Chinese billet prices up by RMB 20/t ($3/t) w-o-w: Billet prices in China’s Tangshan edged up by RMB 20/t ($3/t) w-o-w to RMB 3,060/t ($421/t), including 13% VAT, on 28 March 2025 against 21 March. The rise in trading activity, raw material, finished steel prices, and rebar futures, coupled with declining inventory, have supported billet prices. Meanwhile, SHFE rebar futures (May 2025 delivery) increased by RMB 41/t ($6/t) to 3,197/t ($440/t) on 28 March against 21 March 2025.
4. Domestic HRC prices firm w-o-w: Chinese HRC offers stayed firm w-o-w at RMB 3,330/t ($458/t). SHFE HRC futures (May 2025 contract) increased by RMB 18/t ($3/t) w-o-w to RMB 3,371/t ($464/t) as compared to RMB 3,353/t ($462/t) in the previous week.
China’s HRC export offers rose by $5/t w-o-w to $470/t against $465/t last week. This rise in export prices is fuelled by improved domestic demand. This price rise is driven by improved domestic demand, particularly from manufacturing, which has prompted mills to prioritise domestic sales, thereby limiting export supply and a subsequent price hike
5. Domestic rebar prices surge w-o-w: China’s rebar offers edged up by RMB 30/t ($4/t) w-o-w to RMB 3,320/t ($457/t) from RMB 3,290/t ($453/t) last week, reflecting limited end-user activity due to unfavourable weather. However, SHFE rebar futures (May 2025 contract) stood at RMB 3,192/t for the week, down by RMB 273/t ($38/t) w-o-w from 3,465/t ($477/t) a week ago.
Outlook
China’s steel market experienced a modest price rebound this week, but the overall trend remains weak. Production cuts in major regions sparked optimism, leading to slightly higher prices. However, the market is likely to stay under pressure, with Chinese mills facing limited export pressure which will allow them to maintain their offers too.
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