Taiwan's Feng Hsin Keeps Rebar, Scrap Prices Unchanged

Taiwan's largest rebar producer - Feng Hsin Steel has decided to keep its rebar list price and procurement price of the locally-sourced scrap unchanged over May 18-22 despite the recent rise in global scrap prices, as Taiwan will soon go into summer power supply rationalization, according to a company official.

Feng Hsin's list price for 13mm dia rebar, therefore, remains unchanged at TWD 14,600/MT (USD 488/MT) ex-works for the fourth consecutive week, and the mini mill continues to pay TWD 7,000/MT for locally-sourced HMS 1&2 80:20 scrap, he confirmed.

Feng Hsin's decision to roll over the prices are within market expectation, as rebar sales may well be affected by the endless rainfalls during this week, though last week's rebar sales were at a decent level with some discounts to buyers in actual transactions, according to the company official.

"Many mini mills in Taiwan have decided not to reflect the global scrap price rises, as the consumption (of this steelmaking raw material) will be limited in the near term by the upcoming power supply rationalization," he explained, adding that most electric-arc-furnace (EAF) mills in Taiwan have already done some preparation ahead of the summer months by stocking up some billet to maintain rebar output during the rationalization period.

Taiwan's government usually implements power supply rationalization among local EAF mills as power supply tends to be in shortage over June 1 until the end of September so as to prioritize power supply to residential households in summer, and mills' scrap consumption, therefore, will decline, Mysteel Global understands.

In the global market, in contrast, the price of the U.S.-sourced HMS 1&2 80:20 scrap strengthened for the second straight week by another USD 9/MTon week to USD 232/MT CFR Taiwan, and that of the Japanese H2 scrap gained USD 13/MT on week to USD 243/MT CFR Taiwan, according to a market source.

Taiwan's steel mills usually refer to global scrap price movements in deciding on their scrap procurement prices even for domestic supplies, as both the markets are closely co-related.

This article has been published under an article exchange agreement between Mysteel Global and SteelMint Research.