Chinese steelmaker Boashan Steel has kept finished flat steel prices unchanged for March deliveries following a lull in demand ahead of the Chinese New Year holidays in mid-February. Raw material prices have declined amid easing supplies, while the steelmaker waits for earlier price hikes to get accepted by the end-users.
Demand has slipped as retail sales will remain closed for almost 15-days. Boashan had raised February delivery prices by CNY300-700/mt ($54-108/mt) from the prior month. While in the last three months, the company raised HRC prices by a total of above CNY850/mt ($131/mt).
For March deliveries, the steelmaker held domestic ex-work prices for HRC and cold-rolled coil (CRC) products flat. Despite this, there is a gap between Chinese hot-rolled coil (HRC) prices and those from the US and Europe, indicating room for prices to rise further. In the domestic market, HRC traded at CNY4,430-4,470/mt ex-works eastern China, down CNY20-40/mt. HRC export offers heard at $640-650/mt fob China, down $50-70/mt from early January. Mills await more trades to conclude but buyers remain cautious ahead of the Chinese holidays.
On Wednesday, Q235 150mm square billets prices in China traded at CNY3,860/mt ex-works Tangshan including the 13pc VAT, slightly up by CNY20/mt from the prior day.The export market is slow with most buyers taking a waiting attitude and mills holding their base offers flat.
Spot prices for imported benchmark Fe 62pc content iron ore fell to $164.5/mt cfr Qingdao on Jan 26, down $4/mt from the prior deal amid easing supplies.
Baosteel’s HRC prices set a benchmark for Asian HRC producers like Posco and Hyundai in South Korea, Formosa in Vietnam and JSW and Tata Steel in India.
Earlier in December, China’s Ministry of Industry and Information Technology (MIIT) has asked the country’s steel industry to reduce steel production in 2021 in a bid to lower carbon emissions. The country is likely to maintain a healthy market environment and to reach the carbon neutrality goal for 2060.