Chinese Steel Market Highlights-Week 37

This week Chinese steel market has showed the strong momentum post drastic incident of fire breakout at Bengang Steel corporation.Domestic market has become bullish and futures are increasing rapidly. Export offers for Re-bar and flat product prices rose further and prices of coking coal remained on the higher side.On the hand iron ore prices witnessed decline but demand for high grade material remained high pushing premiums further.

China’s demand for high grade material remained high- Benchmark index in China for Fe 62% fines closed at USD 74.4/MT, CFR China by the weekend. Demand for high grade material (lump and pellets) remained strong amid hike in coking coal prices and sinter production cuts. Spot lump premium increased to USD 0.39/MT and pellet premium increased by USD 6/MT to USD 41.5/DMT, CFR China. Iron ore inventory at Chinese major ports fell by 0.35 MnT W-o-W to 133 MnT.

Higher coking coal prices leads to lower purchases among Chinese buyers-Australian coking coal prices increases further which has lead to stoppage of material booking among Chinese buyers.Australian mills are reluctant to cut down the export offers owing to robust demand to remain intact due to the steel plants operating at high rates both in India and China.The latest offer for the Premium HCC moved up by USD 2.5/MT and are assessed at USD 211/MT FoB Australia against USD 208.50/MT,FoB compared with previous week.

Chinese domestic billet prices increased slightly – Chinese domestic billet prices closed at RMB 3,830/MT (ex-works).

Gains in Domestic Market Drives up Flat Steel Export offers in China-Nation’s domestic market continues to dominate the HRC export offers in China resulting to surge in prices.Chinese HRC export offers rise further by USD 10/MT, W-o-W basis and are prevailing in the range of USD 555-570/MT, FoB China.CRC export offers are heard in the range of USD 600-605/MT,FoB basis.

Chinese Re-bar export offers Pushes Further Post Fire Incident at Ben-gang Blast Furnace-Chinese re-bar export offers rose sharply by USD 10/MT,W-o-W basis post fire incident that took place in Benxi Iron and Steel Blast furnace last week.This incident has also lead to upside trend of re-bar prices in domestic market.In starting of the week, the offers are heard in range of USD 562-580/MT,FoB basis.However due rise in domestic prices the mills have raised the export offers and towards the week end are heard in range of USD 580-595/MT,FoB basis.

Steel Raw Material & Finished Steel Prices in China

Prices in USD/MT
Source:SteelMint Research