Last week witnessed a steep decline in Chinese steel futures which in turn impacted the domestic steel prices and bids for key imported commodities like iron ore, scrap and billets.
After SHFE rebar Oct contract fell by $82 w-o-w, domestic billet prices saw a weekly drop by a similar amount. China’s leading mill – Shagang Steel slashed long steel offers by $47 and scrap purchase bids by a total of $51 via four price cuts seen last week. Also, Rizhao Steel reduced HRC export offers by $50 w-o-w. The futures have continued to show a downtrend in today’s morning trading sessions.
Following this, export realizations of Indian iron ore, pellet & billets also showed significant price correction. Higher freight rates and tightened quarantine concerns for Indian cargoes remained a concern for traders.
Trades slowed down towards the weekend with buyers adopting a ‘wait & watch’ approach in order to have a better understanding of the market. Indian domestic spot steel prices fell on a weekly basis amid extended lockdowns resulting in subdued domestic sales. It was heard some positioned cargoes of HRC (China Origin) were sold at below $1,000/t CFR South East Asia. However, mills have not officially reduced their export offers for fresh shipments.
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