Domestic scrap purchase prices have moved down further by RMB 20-50/MT (USD 3-8) today amid falling global scrap prices and sluggish demand for finish steel in the country.
One of the largest ferrous scrap consumers in east China, Shagang Jiangsu Steel group has cut its domestic scrap purchase price today by Chinese Yuan (RMB) 40/MT (USD 6). After witnessing price cut by RMB 40/MT on 28th May’18 the company has slashed its prices again amid weakening global scrap prices and the sufficient number of supply contracts in hand.
Shagang is now paying RMB 2,260/MT (USD 352) inclusive of 17% VAT for HMS (6-10 mm in thickness) delivered to its headquarter works situated in Zhangjiagang province in China.
In line with this, Shagang has also slashed purchase prices for other grades of scrap by RMB 40/MT in the latest price revision. Shagang is now paying RMB 2360/MT (USD 368) for prime scrap (6-10 mm) and RMB 2340/MT (USD 364) for HMS 1 (thickness not less than 20 mm). While new prices stood at RMB 2160/MT (USD 336) and RMB 2030/MT (USD 316) for melting scrap with specification 4-6 mm and 2-4 mm thickness respectively inclusive of 17% VAT.
Amid lack of strong upward momentum in demand for finish steel in the domestic market China, Shagang witnessed four successive price cuts through which prices have moved down by RMB 140/MT (USD 22) as against temporary peak achieved at RMB 2400/MT in early May.
Shagang Steel is one of the leading steelmakers in China and with an annual production capacity of 31.9 MnT iron, 39.2 MnT steel and 37.2 MnT rolled products. In 2017 Shagang Steel’s domestic ferrous scrap purchases recorded at 5.72 MnT as against 2.43 MnT in 2016, while company forecasts its annual scrap purchases likely to exceed 7 MnT in 2018.
Province-wise domestic HMS scrap reference prices as on 30th May’18 –
| Domestic scrap HMS (6-10 mm), Prices in RMB/MT including 17% VAT | |||
| Province | Origin | Price | Change as against last report on 28th May |
| Shandong | Jinan | 2430 | 0 |
| Jiangsu | Zhangjiagang | 2260 | -40 |
| Fujian | Fuzhou | 2340 | 0 |
| Anhui | Maanshan | 2320 | -40 |
| Zhejiang | Taizhou | 2090 | -50 |
| Guangdong | Guangzhou | 2300 | -20 |
| Tianjin | Tianjin | 2350 | -30 |
| Hebei | Handan | 2460 | 0 |
Source: SteelMint Research; Exchange Rate: 1 USD = 6.42 RMB
Domestic Rebar prices rise on falling inventories – Domestic Rebar prices in eastern China have moved up on falling inventories and stood at RMB 3,870-3,920/MT (up by RMB 20-30/MT D-o-D).
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