Chinese domestic steel section market declines sharply

The Chinese domestic steel section market has indicated a significant downward trend during the past week.

In the Shanghai market, the price of 50 mm x 50 mm x 5 m steel angles is now at $508/mt (RMB 3,490/mt). The same product is sold at $443/mt (RMB 3,050/mt) in the Tangshan market and at $522/mt (RMB 3,590/mt) in the Guangzhou market. Meanwhile, prices of 160 mm x 65 mm x 8.5 mm steel channels stand at $503/mt (RMB 3,460/mt) in the Shanghai market, at $442/mt (RMB 3,040/mt) in Tangshan and at $516/mt (RMB 3,550/mt) in the Guangzhou market. In the Shanghai, Tangshan and Guangzhou markets, 250 mm x 118 mm x 10 m I-beam prices stand respectively at $500/mt (RMB 3,440/mt), $448/mt (RMB 3,080/mt) and $583/mt (RMB 4,010/mt). The prices are all ex-mill, including 17 percent VAT. Steel section prices in the Chinese domestic market can be viewed in the table below.

Prices of billet in the Chinese domestic market have decreased by significant margins during the past seven days. In Tangshan, the current price of Q235 150 x 150 mm square billet is at RMB 2,750/mt ($400/mt), the price of 165 x 225 mm rectangular billet stands at RMB 2,770/mt ($403/mt), while the price of 20MnSi billet is at around RMB 2,850/mt ($414/mt). The prices are all ex-mill, including 17 percent VAT.

The declines in billet prices have been the main reason for the downward trend of the Chinese steel section market in the past week, while overall trading activity for steel sections has slackened as downstream buyers have been maintaining a wait-and-see stance. However, steel section prices are now considered to be close to cost levels and so there appears to be limited room for further downward movement of prices. As for the coming week, it is believed that domestic steel section prices may follow a fluctuating trend, but could rebound slightly if billet prices start to increase. 

$1 = RMB 6.88