China’s leading electric arc furnace (EAF) steelmaker, Jiangsu Shagang Group, cut its scrap purchase prices today, 3 Nov’21. The steel producer reduced its scrap procurement prices by RMB 80/tonne (t) ($13/t) for all grades, with immediate effect, sources confirmed.
With this cut, the current prices of HMS (6-10 mm) stand at RMB 3,570/t ($558/t), including 13% VAT, delivered to headquarters.
Impacted by a weak steel outlook, scrap demand at Jiangsu’s steel mills has weakened, SteelMint notes. Notably, this is the company’s fourth price cut since 22 Oct’21. Prices have come down sharply after peaking to RMB 3,860/t ($604/t)on 12 Oct’21.
Factors behind the price cut
- Reduction in billet prices: Steel billet prices in China’s Tangshan witnessed a sharp day-on-day fall of RMB 100/t ($16/t) on 2 Nov’21. Domestic billet prices stood at RMB 4,800/t ($750/t), inclusive of 13% VAT.
- Chinese rebar futures continue downtrend: According to data maintained with SteelMint, re-bar futures contracts for Jan’22 delivery on the SHFE settled on 3 Nov at RMB 4,388/t ($685/t), a significant decline of RMB 475/t ($74/t), w-o-w. As the market scenario has been seriously challenged by the persistently poor steel demand, the prices are declining significantly.
- Shagang lowered finished steel prices for early Nov: Shagang Steel cut construction steel prices by RMB 600/t ($94/t) for early-Nov’21 sales. Presently, rebar (16-25mm) stands at RMB 5,550/t ($867/t) and wire rods at RMB 5,660/t ($884/t), including taxes.
Leave a Reply