- Shagang lowers scrap procurement prices by RMB 30/t
- Weak steel demand pressures scrap consumption outlook
China’s largest steelmaker, Shagang Group, reduced its scrap purchase prices by RMB 30/t ($4/t) effective 24 June, with the benchmark heavy scrap grade revised to RMB 2,480/t ($365/t) from RMB 2,510/t ($369/t) previously.
The price cut comes amid weakening steel demand as China’s traditional summer off-season begins. Rising temperatures and seasonal rainfall are expected to weigh on construction activity and finished steel consumption.
Market participants noted that scrap has gradually lost its cost competitiveness against hot metal, prompting integrated mills to favour hot metal-based production. At the same time, EAF producers continue to face profitability pressures, limiting scrap consumption and weighing on near-term scrap demand.
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