China’s domestic steel scrap market remained generally stable over the week of January 13-17, with Mysteel’s steel scrap price index assessed at Yuan 2,584.1/t ($369.2/t) on delivery to steel plants and including the 13% VAT, nudging higher by a tiny Yuan 0.4/t, according to Mysteel’s database. The scarcity of market transactions with the approach of the Chinese New Year (CNY) holiday was the chief reason, Mysteel Global noted.
“The domestic steel scrap market is grinding towards suspending business for CNY,” a Shanghai-based market watcher remarked. “Many electric arc furnace (EAF) mills and steel scrap traders are leaving the market earlier to have a longer break because this is the most important holiday of the year,” he explained.
Besides, the thinning steel margins for EAF producers have driven more mini-mills to halt operations for maintenance and to begin holidays early to avoid possible losses.
On the other hand, steel scrap inventories at the 61 domestic steel plants including both blast furnace and EAF producers which Mysteel regularly monitors climbed for the eleventh straight week to reach a near one-year high of 3.94 million tonnes as of January 12, increasing by another 199,400 tonnes or 5.3% on week. This would be sufficient for 20.4 days of consumption among the sampled mills at their present daily utilization, or 1.4 days longer than the prior week, according to Mysteel’s latest weekly survey.
Meanwhile, some mini-mills are thought to have stopped purchasing steel scrap for replenishment now as their stocks at hand are sufficient enough, a market watcher in East China’s Jiangsu province observed.
With more and more EAF mills and scrap traders temporarily withdrawing from the market for the CNY break, China’s steel scrap prices are unlikely to fluctuate to any great degree, Mysteel Global predicted
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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