Posted on 27 Feb 2024
Billet prices in Tangshan in North China's Hebei province experienced a downward correction over February 19-25 as prices were dragged south by the slides in ferrous futures prices, according to Mysteel's weekly survey. However, survey respondents pointed out that local re-rollers had gradually resumed operations last week and this resulted in their demand for billets increasing.
By February 25, the Tangshan Q235 150mm square billet price had lost Yuan 130/tonne ($18.1/t) on week to reach Yuan 3,520/t EXW and including the 13% VAT, according to Mysteel's assessment.
Meanwhile, daily billet consumption among the 55 re-rollers in Tangshan under Mysteel's tracking during February 15-21 soared by some 27,700 tonnes/day on week to average 42,700 t/d.
The ramp-up in production among these re-rollers and their low billet stocks at hand led procurement of the semis to turn active, according to the survey. As of February 21, the re-rollers' billet inventories had grown at a faster pace than in the previous week, jumping by 133,000 tonnes on week to settle at a 6.5-month high of 451,000 tonnes, as against the 31,000 tonnes uptick the preceding week.
In tandem with the replenishment among re-rollers, the pace of accumulation in retail billet stocks had slowed. By February 22, total billet stocks across the four commercial warehouses and two ports in Tangshan that Mysteel monitors totalled 1.59 million tonnes, rising by just 53,200 tonnes on week, as against the 210,600 tonnes surge during the week to February 15.
Some imported billets had arrived at the local ports, according to the survey, which caused a small rise in retail inventories, it noted.
On the other hand, the price slump in the semis expanded the losses borne by local billet makers, with the average loss on billet sales endured by the ten integrated mills in Tangshan Mysteel checks widening by Yuan 81/t on week as of February 22 to Yuan 214/t.
However, the average per tonne cost these mills had incurred when producing the billets decreased by Yuan 19/t on week to Yuan 3,764/t including the 13% VAT last week, the survey found.
Over February 16-22, daily billet output among the 30 steelmakers in Tangshan sampled by Mysteel stayed largely stable from the previous week, edging up by 300 tonnes on week to 37,900 t/d on average.
Source:Mysteel Global
