Chinese Steel Market Highlights - Week 48, 2019

This week Chinese steel prices exhibited mixed sentiments. Nation's HRC and rebar export offers moved up. Meanwhile coking coal offers remained stable on weekly basis however iron ore prices dropped towards the weekend.

Chinese spot iron ore prices fell during the week - Chinese spot iron ore fines price opened up this week at USD 90.45/MT,CFR China.The prices have witnessed 1.5 months high as it was last witnessed at USD 92/MT towards mid of Oct 2019. However, the price dropped to USD 87.25/MT, CFR China towards weekend amid fall in inventory.

As per data compiled by SteelHome consultancy, iron ore inventory at major Chinese ports dropped slightly to 129. 4 MnT as against 129.5 MnT assessed towards the end of last week.World's largest iron ore miner- Vale has completed decommissioning at one of the nine upstream tailing dams this week.The de-characterization at 8B dam located at Aguas Claras mine, in Nova Lima began in May 17 and does not offer any risk of breach anymore.

Spot lump premium moved up on a weekly basis- This week spot lump premium witnessed at USD 0.2280/DMTU against USD 0.2100/DMTU towards last week. Amid sintering cuts demand for lumps remain supported.

Coking coal prices remain steady on weekly basis- - This week, the seaborne coking coal prices remain largely stable on weekly basis.However Chinese steelmakers continue to import amid competitive pricing as compared to domestic market.

Meanwhile the implementation of Chinese import restrictions may further extend beyond this calendar year remained uncertain since the fears to extend until the Chinese New Year in late January can be a possibility.

The latest offers for the Premium HCC grade assessed at around USD 133.75/MT FoB Australia remain stable against previous week.

China domestic billet prices inch up on a weekly basis- Chinese domestic billet market was settled at RMB 3,450/MT, up RMB 10/MT against last week.The market sentiments in the country were reported stable in the country.Meanwhile nation's billet export offers also witness uptick as domestic prices gained the momentum.

Chinese HRC export offers increase following uptrend in domestic prices-This week Chinese steel mills have further increased their HRC export offers by USD 10/MT on the back of limited supplies amid announced winter production curbs and robust demand prevailing in the domestic market.

Thus, Chinese HRC export offers have increased to USD 460-465/MT FoB China, in contrast with USD 450-455/MT FoB basis in the previous week.

Meanwhile, Chinese domestic HRC prices moved up by RMB 20-30/MT during the week to RMB 3,700-3,720/MT in the Shanghai region, which was RMB 3,670-3,700/MT in the preceding week.

Thus Chinese steel mills are enjoying decent demand in the domestic market, along with strengthening prices ahead of the winter season.Meanwhile mills are actively restocking the material ahead of new year holidays which pushed prices in upward direction.

Nation's Rebar export offers increase on a weekly basis- This week, China's rebar export offers ascended by USD 10-13/MT this week.

Hence, current Chinese rebar export offers stand at USD 475-483/MT FoB China in contrast with USD 465-470/MT FoB basis in the previous week.

However, the domestic rebar prices in eastern China slumped by RMB 70-80/MT to RMB 4,010-4,040/MT as compared with RMB 4,080-4,120/MT a week ago over ongoing winter season.

Shagang Steel lowered scrap purchase price twice - Eastern China's largest private ferrous scrap consumer and EAF steelmaker - Shagang Jiangsu Steel group has announced its 2nd price lowering in a week, cutting down its bids by RMB 30/MT (USD 4) for all grades of domestic steel scrap procurement, with the new prices effective from 29th Nov'19.

As per updates, Shagang Steel is paying RMB 2,730/MT inclusive of 13% VAT for HMS (6-10 mm thickness) delivered to headquarters works situated in Zhangjiagang north of Shanghai in China.

Chinese Steel Market Highlights - Week 48,2019

Source: SteelMint Research