Taiwan Feng Hsin's rebar, scrap prices down $17/t

Feng Hsin Steel, Taiwan's largest rebar producer headquartered in Taichung, central Taiwan, has decided to lower its rebar list prices and procurement prices for locally-sourced scrap each by another TWD 500/tonne ($16.8/t) for transactions over May 16-20, a company official confirmed on Tuesday.

With the latest adjustment, the mini-mill is offering its 13mm dia rebar at TWD 23,300/t EXW for trading till this Friday, according to the official, marking the fourth straight weekly decline and taking the total reduction to TWD 1,800/t, Mysteel Global notes. At the same time, the steelmaker's buying price for local HMS 1&2 80:20 scrap declines to TWD 13,000/t this week, with the total drop over the past month reaching TWD 2,000/t, he added.

One major reason for Feng Hsin's additional price cut was the persistent fall in global scrap prices, the company official explained.

As of May 16, the price of US-sourced HMS 1&2 80:20 scrap was reported at $450/t CFR Taiwan, down another $25/t on week. Meanwhile, the price of Japan-origin H2 scrap had slipped for the sixth straight week by a sharper $38/t on week to reach $497/t CFR Taiwan, according to a market source in Taiwan.

"Mini-mills in many countries such as South Korea, Vietnam and Turkey have been trying to lower their scrap buying prices to reduce their production costs and improve their competitiveness in the global market," Feng Hsin's official explained, noting that prices of square billet - a key input - have been lower thanks to the drop in iron ore prices.

For example, the Mysteel SEADEX 62% Australian Fines iron ore index was at $128.4/dmt CFR Qingdao as of May 13, lower by $7.85/dmt from one week earlier, according to Mysteel's data.

Apart from the decrease in scrap prices, the softening rebar demand from local end-users also persuaded the mini-mill to trim its rebar list price again, Mysteel Global learned.

"Although building contractors in Taiwan have not been requested to halt operations from increased confirmed cases of COVID-19, progress on construction projects has been slowed by the arrival of the rainy season," the official explained.

Written by Nancy Zheng, zhengmm@mysteel.com
This article has been published under an exchange agreement between MySteel Global and SteelMint.