China’s steel prices will continue to remain strong in 2018 as production and supply are becoming more balanced, according to a senior official at the China Iron and Steel Association (CISA).
“Prices have been on upward trend in 2017 due to government effort to close small mills that produce low-quality steel. Prices have seen a reasonable rebound, while it is quite normal to see tight supply and price fluctuations during certain periods,” said Gu Jianguo, deputy head of CISA, told an industry forum on Friday.
Despite Chinese official numbers of crude steel production are seen increasing in 2017, net production has been down as small mills did not report their production numbers.
Chinese crude steel production expected to touch 850 MnT in CY17(estimated) against 807.28 MnT in CY16.
Chinese HRC export offers have also reported surge in CY 17.Chinese HRC export prices on an average basis have increased from USD 363/MT in 2016 to USD 503/ MT in 2017 (till Nov).
On the other side Chinese steel exports have dropped from 108.19 MnT in CY16 as compared to 80 MnT (expected ) in CY 17.Thus Chinese mills are increasing their production capacities but majorly utilizing it for domestic consumption amid strong demand in China.
Also,latest measures to curb excess steel supply in China to reduce production by nearly 60 MnT of steel products from November to March also stimulate global steel prices in the first quarter of next year.
China Steel Statistics and Prices
| Particulars | CY16 | CY17 |
| Chinese HRC Export Offers (FoB China) | USD 363/MT | USD 503/MT |
| Domestic Prices in China (eastern China, ex-works) | RMB 2,937/MT | RMB 3,747/MT |
| Finished Steel Export Volumes (in MnT ) | 108.19 | 80 (estimated) |
| Chinese Crude Steel Production (in MnT ) | 807.28 | 850 (estimated) |
Prices mentioned above are till Nov’17
Source-Steelmint Research
Leave a Reply