Shagang Steel keeps prices flat for late August

East China-based region steelmaker Shagang Jiangsu group has kept its finished long steel prices unchanged for shipments scheduled till August 31.

Though demand for finished steel has dipped, it remains strong. With the rising production rate, however, a glut of finished steel could have pressured prices. Additionally, infrastructure projects have also slowed down. On the other hand, bullish raw material prices have kept the input cost firm for steelmakers.

The mill is offering rebar HRB400 of 16-25mm diameter at CNY3,900/mt ($564/mt) ex-works for late August deliveries, unchanged from mid-August. The steelmaker’s prices for wire rods are at CNY4,010/mt ($580/mt) ex-works.

Shagang Steel’s retail prices before discounts and negotiations for August 21-31 :

Steel consumption in China’s northern region remains high but remains hampered significantly by storms and floods in the southern provinces. The extreme weather events are likely to come under control by September after which demand will increase again. 

Another steelmaker Yonggang has also kept its rebar offers unchanged but has raised wire rod prices by CNY50/mt ($7/mt) for August 21-31 deliveries, Davis Index heard from a source.

Singapore iron ore futures continued to gain on Monday, as spot prices of China-bound iron ore cargoes hit their highest since January 2014 on strong demand.

Ferrous scrap prices stay firm 

Chinese steel mills have increased consumption of ferrous scrap due to a sharp rise in spot iron ore prices. While mills producing steel using blast furnaces continue to face margin squeeze, steelmakers using electric arc furnaces booked more ferrous scrap. 

Chinese ferrous scrap prices were on an uptrend last week with Shagang Steel purchasing domestic #2 HMS (6-10mm thickness) at prices up by CNY30/mt from two weeks ago at CNY2,720/mt delivered to the Jiangsu mill in Zhangjiagang. 

($1=CNY6.91)