China: Shagang Steel Cuts Down Scrap Purchase Price by RMB 50 (USD 7)

The company observes second price cut in a week amid falling finished steel prices

Eastern China's largest private ferrous scrap consumer and EAF steelmaker- Shagang Jiangsu Steel group has announced another price cut for its scrap purchase price, second in a week's time. The company has lowered its purchase price by RMB 50/MT (USD 7) for all major grades of domestic scrap, effective from today, 3rd March'20.

After the said price cut, Shagang Steel will now pay RMB 2,620/MT (USD 376) inclusive of 13% VAT for HMS (6-10 mm thickness) delivered to headquarters works situated in Zhangjiagang north of Shanghai in China, down by RMB 50/MT (USD 7) against the last revision to RMB 2,670/MT on 27th Feb'20.

While other higher grades including HMS (thickness not less than 20 mm) and HMS (10-20 mm thickness) stand at RMB 2,700/MT (USD 387) and RMB 2,660/MT (USD 382) respectively.

The recent price cuts in scrap purchase can be attributed to the decline in domestic finished steel demand in the region, pulling down finished steel prices recently. This has resulted in a drop in scrap consumption by steel mills, leading to a downtrend in scrap prices.