China’s leading electric arc furnace (EAF) steelmaker, Jiangsu Shagang Group, has reduced its scrap purchase prices for the third time in June 2022 owing to sluggish domestic finished steel sales in the market.
The steelmaker has cut its scrap procurement prices by RMB 100/tonne (t) ($15/t) for all grades with immediate effect, sources confirmed. The current prices of HMS (6-10 mm) stand at RMB 3,620/t ($540/t), including 13% VAT, delivered to headquarters.
The drop in steel prices has continued to weigh on scrap purchase prices.
China market scenario-
- Billet prices plunge: Steel billet prices in China’s Tangshan fell sharply by RMB 200/t ($30/t) d-o-d on 17 June 2022 following a steep decline in rebar futures. Prices stood at RMB 4,180/t ($623/t), inclusive of 13% VAT.
- Rebar futures continue to fall: According to data maintained with SteelMint, China’s SHFE rebar futures contract for October 2022 delivery closed at RMB 4,354/t ($649/t) on 17 June, falling by RMB 152/t ($23/t), d-o-d.
- Spot iron ore prices slide: Seaborne iron ore prices continued to fall further on 17 June as bearish demand was observed in the market. The 62% Fe iron ore index was at $122.15/t CFR North China, down $7.35/t d-o-d.
- Imported scrap prices drop: Imported scrap prices, too, noticed a sharp fall of $10/t d-o-d on 17 June. Prices of USA-origin shredded material are at $479/t and HMS at $459/t CFR levels.
Outlook
It is expected that prices may fluctuate in the short-term as the ongoing monsoon have caused a lull in construction activities.
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