China's Shagang Steel raises scrap purchase price on demand-supply mismatch

Eastern China's largest EAF steelmaker- Shagang has increased scrap purchase price for all grades by RMB 80/t ($12). The purchase price of HMS (6-10 mm) thickness has risen to RMB 3,020/t ($461), inclusive of 13% VAT delivering to headquarters works at Zhangjiagang North of Shanghai in China, effective from today (21st Dec'20).

While the price of other grades including HMS (10-20 mm) thickness stands at RMB 3,050/t ($465) and HMS (not less than or equal to 20 mm) thickness stands at RMB 3,080/t ($470). The company has revised its scrap purchase price after a month.

Supplies have remained tight amid winters in China. However, demand is yet to slow down ahead of holidays.

• Sharp hike in billet prices - The price trend of finished steel is strong indicating the remaining solid demand from the Chinese steelmakers in contrast to the limited seasonal supply in winter. The billet prices in the Tangshan market (northeast China) settled with sharp rise of RMB 80 ($12). The prices of commonly traded Q235 billet 150mm diameter were reported at RMB 3,800/t in Tangshan, inclusive of 13 % VAT.
  
  
• Rebar futures soar - Today, SHFE rebar futures May'21 contract increased sharply and closed at RMB 4,460/t against RMB 4,316 towards last week end.
  
  
• Spot iron ore prices close higher - High-grade iron ore prices picked on steel production expected in the near-term in China amid delayed winters. Chinese spot iron ore fines (Fe-62) price opened at $154.50/ t CFR China last week and increased to $164.15/t CFR basis towards the weekend. High-grade iron ore prices picked on steel production expected in the near-term in China amid delayed winters.