Taiwan's Feng Hsin rolls over rebar, scrap prices

Feng Hsin Steel, Taiwan's largest rebar producer, has decided to roll over its rebar list prices and buying price for locally-sourced scrap over September 21-25 to monitor scrap price trends in the global market, a company official told Mysteel Global on Tuesday.

For business till this Friday, the mini-mill headquartered in Kaohsiung in south Taiwan is still offering its 13mm dia rebar at TWD 15,700/tonne ($541/t) EXW, the same level as the prior week, while its procurement price for locally-sourced HMS 1&2 80:20 scrap stays unchanged on week at TWD 7,900/t, according to the official.

Global scrap prices retreated recently after growing steadily for two months, as "buyers in overseas markets have slowed their pace of buying after noting the high (scrap) prices," the official said.

As of September 21, the price of US-sourced HMS 1&2 80:20 scrap in Taiwan was assessed at $280/t CFR Taiwan, reversing down $5/t on week after growing by a total of $53/t over the prior two months, Mysteel Global learned. The price of Japanese H2 scrap also retreated from a 15-month high, dipping by $7/t on week to $295/t CFR Taiwan.

Feng Hsin decided to hold its buying price for locally-sourced scrap for procurement this week rather than follow the retreat in global scrap prices, mainly due to the fact that "the growth in locally-sourced scrap over the past two months was much lower compared with that in the global market," the Feng Hsin official pointed out.

For example, the mini-mill's latest procurement price for locally sourced HMS 1&2 80:20 scrap is higher by only TWD 1,000/t compared with two months earlier, Mysteel Global noted.

Feng Hsin's rebar sales softened to some extent over the past week as steel users adopted a wait-and-see tactic after noting the higher selling prices.

However, market participants in Taiwan believe that demand from end-users will be reasonable in the coming term as the October-December quarter is the traditional peak season for steel consumption in Taiwan with the mild weather favourable for outdoor construction activity. At the same time, many building contractors will try to complete their projects before the end of the year, which may boost steel demand during that period.

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