“Although the recent fluctuations in steel prices have placed the domestic mills under some pressure, steel scrap demand has been firm with the resumption of electric-arc-furnace (EAF) steelmakers after the Chinese New Year holiday,” a Shanghai-based market watcher explained.
On the other hand, the resurgence of COVID-19 cases in East China’s Jiangsu province has largely affected local scrap collecting and processing activities, causing scrap supplies to become limited, Mysteel Global noted.
“The rise in COVID-19 cases in Jiangsu has seen local authorities conduct much stricter health checks on truck drivers, while some toll stations have been forced to shut to control the spread of cases, effectively closing some stretches of highway,” another Shanghai-based marker watcher explained, saying this had disrupted some scrap deliveries to mills as well.
Over February 11-17, scrap deliveries to the 61 steel mills under Mysteel’s regular survey including both blast furnace and EAF producers averaged a low 2,471 tonnes/day, while daily scrap consumption among these mills was steady at a higher level of 2,720 t/d.
Consequently, higher demand amid lower delivery saw steel scrap stocks at the 61 surveyed mills fall for the third straight week by another 101,800 tonnes or 3.5% on week to 2.81 million tonnes as of February 17 – the lowest since October 2021. The tonnage was sufficient to last the mills for 18 days of consumption at their present daily usage rate, or 1.1 days shorter on week, according to Mysteel’s assessment.
As of February 18, China’s national average price of HRB 400E 20mm dia rebar, an important indicator of China’s domestic steel market, had slipped by Yuan 110/t on week to reach Yuan 4,922/t and including the 13% VAT, the data shows.
Written by Lindsey Liu, liulingxian@mysteel.com
This article has been published under an exchange agreement between MySteel Global and SteelMint.
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