Tangshan, the largest steel-producing city and the largest billet supplier in China, has seen its integrated steel mills bring their blast furnaces back online one after another since October 3 after producers suspended operations from late September under air-pollution control measures, as Mysteel Global reported.
Mysteel’s latest survey showed that the capacity utilization rate of 138 blast furnaces in Tangshan had increased 1.7 percentage points from September 30 to 67.7% as of October 7 – though this was still down by 8.6 percentage points on month or by 11.3 percentage points on year. The utilization rate is likely to increase further in coming days as more mills are planning to fire up their furnaces again, a local market source confirmed.
Meanwhile, steel re-rollers in Tangshan have also been resuming operations after the production bans previously imposed on them were lifted on October 4, according to the source.
As of October 7, the operation rate of 59 section re-rollers in Tangshan which Mysteel surveys regularly had recovered to 68% from zero on September 30, the latest survey showed.
“Currently, the buying appetite (for billets) among these re-rollers is not too strong as some rollers recently received deliveries of feedstocks under previously signed forward contracts,” the Tangshan source said.
“However, as the re-rollers increase their operation rates, it is possible that demand for billets will pick up soon, which will lend support to billet prices,” he added.
As of October 7, Mysteel’s Q235 150mm Tangshan billet benchmark price had grown by Yuan 10/tonne ($1.4/t) from before the National Day holiday to reach Yuan 3,410/t EXW and including the 13% VAT.
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