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China’s steel prices strengthening

Posted on 07 September 2021

China’s steel prices including rebar and hot-rolled coil (HRC) in the spot and futures markets strengthened over August 30-September 3, as steel production cuts have been adopted in more regions while domestic demand showed signs of continuing pick-up albeit at a slow pace, Mysteel Global noted.

 

Rebar: As of September 3, China’s national price of HRB400E 20mm dia rebar, under Mysteel’s assessment, increased for the second week by Yuan 87/tonne ($13.5/t) on week to Yuan 5,357/t and including the 13% VAT.

Over August 30-September 3, the daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil among China’s 237 steel traders also grew for the second week, gaining 23,932 tonnes/day or 12.4% on week to an average of 217,522 t/d for all, according to Mysteel’s tracking.

As of September 3, the most-traded rebar January 2022 contract on the Shanghai Futures Exchange (SHFE) closed the daytime trading session at Yuan 5,408/t, or up for the second week by Yuan 260/t from the settlement price on August 27. The contango against the Shanghai spot rebar price, thus, widened to Yuan 68/t from Yuan 22/t in the prior week.

Billet: The Q235 150mm square billet price in Tangshan of North China’s Hebei jumped for the second week by Yuan 110/t on week to Yuan 5,060/t EXW and including the VAT last Friday, and billet stocks fell substantially with the ramp-up in output among the local steel re-rollers.

HRC: As of September 3, China’s national price of Q235 4.75mm HRC under Mysteel’s assessment rose for the second week, up Yuan 96/t on week to Yuan 5,783/t and including the 13% VAT, and HRC stocks at the commercial warehouses in China’s 33 cities under Mysteel’s tracking dropped for the third straight week, down 98,000 tonnes on week to 2.85 million tonnes as of September 2.

SHFE’s most-traded HRC January 2022 contract gained for the second week as of September 3, closing at Yuan 5,784/t when the daytime trading session ended, or up substantially by Yuan 353/t from the settlement price on August 27, and its backwardation against the Shanghai spot HRC price, accordingly, shrank sharply to Yuan 16/t from Yuan 165/t in the previous week.

Source : Mysteel Global