Taiwan Feng Hsin lowers rebar prices by $34/t on week

Feng Hsin Steel, Taiwan's largest rebar producer headquartered in Taichung in central Taiwan, has decided to trim its rebar list prices by a large TWD 1,000/tonne ($33.7/t) on week for business discussions over June 27-July 1 to reflect the substantial fall in global scrap prices, a company official confirmed on Tuesday.

With the latest adjustment, Feng Hsin is offering its 13mm dia rebar at TWD 21,600/t EXW till this Friday, the second reduction in two weeks and touching the price's lowest since the start of February, according to the official. The mini-mill rolled over its buying price for local HMS 1&2 80:20 scrap at TWD 11,500/t at the weekly pricing meeting on Monday, as it had cut prices by TWD 400/t last Thursday and by another TWD 500/t on June 25, the official added.

Feng Hsin's product price cut was partly to reflect the dramatic drop in global scrap prices, Mysteel Global learned.

As of June 27, the price of US-sourced HMS 1&2 80:20 scrap had slumped to $370/t CFR Taiwan, posting a sharper fall of $50/t on week after sliding by $20/t over the prior week and marking the lowest since mid-February 2021, while the price of Japan-origin H2 scrap declined for the fourth consecutive week by another $10/t from one week before to reach $430/t CFR Taiwan, according to a local market source.

The scrap-price slump has exceeded market expectations, aggravating the pessimism in Taiwan's steel market and encouraging more local end-users to adopt a wait-and-see stance. "We are concerned that global scrap prices have not yet bottomed out," the official said.

Besides, mini-mills in Taiwan will face more cost-side pressure soon after the local government announced Monday that it was hiking electricity prices by 15% for heavy industrial electricity consumers including electric-arc-furnace steelmakers, effective from July 1, Mysteel Global noted.

"The rise (in the electricity price) means that the average production cost of local EAF mills may increase by TWD 200-300/t, but the growth is acceptable compared with the sharp fall in scrap prices over the past two weeks," he said, adding that mini-mills in Taiwan can still gain some profit on finished steel sales at the moment with the lower prices of steelmaking raw materials.

Written by Nancy Zheng, zhengmm@mysteel.com
This article has been published in accordance with an article exchange agreement between Mysteel Global and SteelMint.