Posted on 19 Sep 2023
Prices of carbon steel billets in Tangshan in North China's Hebei province under Mysteel's assessment regained some ground over September 11-17, thanks to the rise in re-roller demand for the semi-finished longs.
As of September 17, the price of Q235 billet in Tangshan had recovered by Yuan 50/tonne ($6.9/t) on week to reach Yuan 3,550/t EXW and including the 13% VAT, according to Mysteel's survey. Respondents said that stronger demand for finished steel had helped lift semis prices.
Re-rollers cranked up their production and procured more semis to replenish their feed materials during the survey period, in response to rising spot and futures prices for finished steel and more active trading, Mysteel Global noted.
Over September 7-13, total billet consumption among the 55 re-rollers under Mysteel's tracking increased further by 7,500 tonnes/day or 13.5% on week to average 63,100 t/d. Meanwhile, total billet inventories held by these re-rollers also increased by 13,500 tonnes or 3.7% on week to 375,000 tonnes, Mysteel's survey showed.
Regarding supply, steelmakers in Tangshan also raised their semis production as demand grew, with daily billet output among the 30 mills under Mysteel's coverage climbing by 1,300 tonnes/day or 2.5% on week to 53,300 t/d over September 8-14.
During the same period, the capacity utilization rate among the 89 blast furnaces in Tangshan under Mysteel's tracking eased by 0.73 percentage points on week to average 90.8%.
Under these circumstances, the accumulation of retailers' billet stocks slowed last week, with total inventories in the four commercial warehouses and two ports under Mysteel's tracking declining by 43,000 tonnes or 6% on week to sit at 676,600 million tonnes as of September 14.
In parallel, the rise in billet prices helped steelmakers in Tangshan reduce their losses on billet sales, Mysteel Global learned. For example, the losses suffered by the ten integrated mills in Tangshan under Mysteel's tracking when selling billets shrank by Yuan 15/t from the previous week to average Yuan 22/t on September 14, while the average cost they incurred when producing them inched up by Yuan 5/t on week over September 7-13 to Yuan 3,552/t including the 13% VAT.
Source:Mysteel Global
