SteelOrbis Shanghai Boosted by the rising prices of raw materials, Chinese billet prices continued to go up over the past week, but the trading volume was very sluggish; meanwhile, slab market climbed up by a small step. Looking at the price levels on March 14 compared with a week ago; the price of common carbon
billet in Tangshan, Hebei Province was RMB 2,970/mt ($384/mt), and that of 20MnSi was RMB 3,020/mt ($391/mt), both up RMB 20/mt ($3/mt) week on week. Meanwhile, the ex-factory price of
slab from
Laiwu Steel was up RMB 50/mt ($6/mt) to RMB 3,050/mt ($395/mt). The export duty imposed on
iron ore by Indian Government has brought additional rising momentum to the Chinese
iron ore market with supply falling short of demand, thus
production costs jumped up considerably. Last week, many
semis producers hiked their
billet ex-factory prices slightly. However, the present market inventories of various steel products remain at a high level; while due to the unrecovered demand, the
consumption of the inventory is very slow; therefore, the overall market saw a flat
trading performance. Some insiders of those
billet producers mentioned that they did not receive many inquiries over the past weeks. Although Chinese government has not announced any additional tariffs on
semis exports over the 10 percent announced in last October, the mills have become increasingly cautious concerning the exports. Their
billet export quotations in general are around $480-500/mt FOB. The quotation level is not very attractive for foreign traders, so the
trading volume is limited. On all accounts, the relatively high
billet price level and bearish performance in finished steel market caused the rolling mills to be inactive in their purchases. Thereby, sluggish tendency began to appear in the current semi finished steel market. It is expected that the prices will see downward movement in the short run. The latest data issued by
China Customs indicated that Chinese
semis exports totaled 540,000 mt in February, almost equal to the level of January's 570,000 mt; while this figure in December last year hit 500,000 mt. All the exports over the three consecutive months maintained in the range of 500,000-600,000 mt. Does it mean that
China's
semis exports have entered into a stable stage? Maybe we still need to wait and see. Chinese semi-finished steel imports reached 30,000 mt in February, neutral month on month. Since the beginning of year 2006, mostly,
China's monthly
semis imports were lower than 50,000 mt.