Chinese slab prices jump up considerably

SteelOrbis Shanghai Last week, China's semi finished steel market showed a continuous upward trend. Billet in Tangshan saw a price rebound, while the other regions climbed steadily up. As regards slab, prices jumped up considerably after the previous long-standing calm period. On February 07, the price of both common carbon and 20MnSi billets in Tangshan, Hebei Province saw RMB 30/mt ($4/mt) week on week increse to RMB 2,900/mt ($375/mt) and RMB 2,950/mt ($381/mt), respectively. Meanwhile, the ex-factory price of slab from Laiwu Steel has risen RMB 50/mt ($6/mt) to RMB 3,000/mt ($388/mt). Due to the price drop of billet in Tangshan in the last week of January, the rolling mills were active in purchasing throughout the past week, leading to a good trading performance and a slight increase in market prices. In eastern China, since Shagang and some other leading mills made a relatively big upward adjustment to their ex-factory prices for long products, billet prices rose up by a big step in the Jiangsu area at the beginning of the past week, before seeing a slight decline at the end of the week. However, both billet producers and traders remained in an optimistic mood. Therefore, the overall upward tendency continued in the market. Meanwhile, billet prices in the other regions still maintained their stability on the whole. With regard to slab, following the previous long-standing calm period, prices saw a sharp jump up in recent days. This mainly resulted from the big increases in the ex-factory prices of HR products and medium plate, which had already been accepted by the market. As a result, the rolling mills also accepted the increased slab prices. Recent and persistent market rumors suggest that the Chinese government is likely to raise the tariffs on semis exports. Moreover, since the current domestic price is almost equal to the export price level, mills and traders are not very interested in exporting. However, due to the rising quotations of CIS semis to Southeast Asia, buyers may have no choice but to accept Chinese billet and slab, thus supporting a continuous increase in China's domestic prices.