Chinese Steel Market Highlights – Week 17, 2018

In the beginning of the week Chinese steel market was consumed with optimistic sentiments in global and domestic market. Strengthening futures lead to uptick in Chinese steel prices. However by the end of the week prices witnessed decline in export market over weak purchases. Trade activities are expected to remain low amid public holidays in first two days of next week.

Flat Steel export offers remain volatile and re-bar export offers remain steady this week despite gains in domestic market.However Coking coal prices continued to decline further over excess supply and low demand from importing nations. Iron ore prices fell sharply towards the weekend.

Chinese spot iron ore prices fell sharply towards weekend – China spot iron fines prices declined from USD 67.55/MT, CFR China in the beginning of the week to USD 64.95/MT, CFR by Friday. Ferrous futures also tumbled ahead holidays.

Spot iron ore prices fell and very limited seaborne cargo bookings were heard.Spot pellet premium edged up this week and is assessed at USD 43.15/MT, CFR China. Few market participants expect pellet demand in China to pick up in coming days after Labour day amid sintering restrictions.

Spot lump premium was assessed at USD 0.17/DMT, CFR China.Iron ore inventory at Chinese major ports was recorded at 159.28 MnT, down 0.5 MnT than a week ago.

Coking coal offers continues to decline further-Australian coking coal offers continues to decline further amid over supply and lower bookings from importing nations.Thus demand and supply mismatch has lead to downward trend in coking coal prices from Australia.

Meanwhile Chinese steel makers have halted their purchases and are waiting for the prices to come down to significant levels.Currently,Premium HCC prices was assessed at around USD 186/MT FoB Australia. Last week the offers were heard at USD 192/MT FoB basis.

Chinese billet export offers move up, trades reported – Chinese billet export offers moved up this week and also trades were reported to South East Asian nations. Current assessment stands at USD 530-540/MT, FoB China. Domestic spot billet(150*150mm, Q235) prices in China have remained stable and is assessed at RMB 3,670/MT (including 17% VAT) against week opening of RMB 3,640/MT (including 17% VAT).

Chinese HRC export offers remain fluctuating – In the beginning of the week China’s HRC export offers witness rise over gains in the domestic market. However by the end of the week market sentiments started weakening and further lead to decline in prices.

Currently Chinese HRC price assessment is in the range of USD 585-605/MT,FoB China. Payment are made on letter of credit basis for 1,000-10,000 MT.In the beginning of the week the offers was heard in the range of around USD 595-600/MT .

Prices of HRC in the domestic market are gauged at RMB 4,110-4,140/MT (ex-works) in Eastern China and at RMB 3,970- 3,990/MT in Northern China.

Chinese Re-bar export offers remain firm- Nation’s re-bar export offers remain largely stable despite uptrend in domestic prices.

Currently,nation’s re-bar export offers are at USD 545-560/MT on China.However major mills are offering on higher side which is around USD 565-575/MT FoB basis.

Meanwhile prices in the domestic market are heard at RMB 3,890-3,930/MT(eastern China) and RMB 3,750 – 3,770/MT (Northern China).

Market participants are expecting that rebar export offers will remain around USD 545/MT in coming week as alternative supplier prices are still higher than China’s prices.

Chinese Steel Market Highlights – Week 17, 2018

Source: SteelMint Research