China: BF mills earn better profits on steel sales in Jul’25

• Finished steel prices rise rapidly in H2 of July
• Profits on HRC sales outpace those on rebars

Mysteel: China’s blast-furnace (BF) steel mills achieved better profits on finished steel sales in July, mainly due to the fast recovery in domestic steel prices, despite higher production costs, according to Mysteel’s latest monthly survey of 91 BF mills nationwide.

Last month, the average profit on rebar sales among the sampled mills was RMB 196/tonne (t) ($27.3/t), higher by RMB 129/t m-o-m, while their profits on sales of hot-rolled coils (HRCs) grew even more sharply m-o-m, by RMB 143/t to RMB 279/t.

The findings showed that the sampled steelmakers’ average profit on sales of medium plates also increased by RMB 80/t m-o-m to RMB 335/t last month.

China’s finished steel prices increased rapidly in the second half of last month as positive market sentiment prevailed, buoyed by expectations regarding new policy measures to stimulate growth.

On 31 July, Mysteel assessed China’s national price of HRB400E 20-mm dia rebar, a bellwether of domestic steel-market sentiment, at RMB 3,407/t, including 13% VAT, higher by RMB 196/t from one month earlier. At the same time, Mysteel’s price assessment for Q235 4.75-mm HRCs jumped by RMB 250/t m-o-m to RMB 3,481/t, including 13% VAT.

The significant growth in finished steel prices offset the rise in the production costs being borne by the domestic steel mills.

During last month, the average production cost of making rebar among the sampled BF steelmakers climbed up by RMB 103/t m-o-m to RMB 2,985/t, including 13% VAT, while the costs incurred by mills making HRCs and medium plates increased by RMB 152/t and RMB 150/t, respectively, m-o-m to RMB 3,142/t and RMB 3,163/t, including VAT, according to the survey.

The higher price of iron ore was chiefly responsible for the rise in the domestic mills’ production costs. The Mysteel SEADEX 62% Australian Fines index averaged $99/dry metric tonne (dmt) CFR Qingdao in July, up by $5/t m-o-m, while the average price of second-grade metallurgical coke in North China dipped by RMB 4/t m-o-m to RMB 1,165/t, the survey results showed.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.