On the back of rising production costs, section steel prices have continued to trend up in the Chinese domestic market during the week ending January 18. Recently, iron ore, coke and semi-finished steel prices have all been on the rise, thus driving section steel prices upward, even though demand for section steel products still lacks strength. Meanwhile, the positive pricing trends seen for other finished steel products in the local market have also played an important role in the increasing trend observed in the section steel market. As of January 18, the average section steel sales prices in the main regions of China are as follows:
Product name |
Specification |
Category |
Average price (RMB/mt) |
Weekly change (RMB/mt) |
Price ($/mt) |
Weekly change ($/mt) |
Angle |
50 mm x 50 mm x 5 m |
Q235 |
4,693 |
+46 |
702 |
+7 |
Channel |
160 mm x 65 mm x 8.5 m |
Q235 |
4,753 |
+56 |
710 |
+9 |
I-beam |
250 mm x 118 mm x 10 m |
Q235 |
4,793 |
+36 |
719 |
+5 |
In the Shanghai market, the price of 50 mm x 50 mm x 5 m steel angles is now at RMB 4,730/mt ($719/mt). In addition, steel angles are sold at RMB 4,600/mt ($699/mt) in the Tangshan market and at RMB 4,750/mt ($722/mt) in the Guangzhou market. Meanwhile, prices of 160 mm x 65 mm x 8.5 m steel channels stand at RMB 4,780/mt ($726/mt) in the Shanghai market, at RMB 4,630/mt ($704/mt) in Tangshan and at RMB 4,850/mt ($737/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 RMB 4,760/mt ($723/mt), RMB 4,820/mt ($733/mt) and RMB 4,800/mt ($729/mt). The prices are all ex-mill, including 17 percent VAT.
Steel production costs on the rise in China
At present, ex-India iron ore (63.5 percent) prices are given by Chinese traders at the level of RMB 1,350/mt ($204/mt) in the domestic market. In the Tangshan market, coke prices are now standing at RMB 1,900/mt ($287/mt). Furthermore, it is reported that semi-finished steel prices have risen to around RMB 4,250/mt ($643/mt), including 17 percent VAT, in the Chinese domestic market.
In conclusion, despite slow buying activity, traders are now positive on the prospects for the post-holiday section steel market in China, due to the continuous rising trend of input costs and the possible 20 percent export tax for all iron ore exports being considered by the Indian government. Thus, it is expected that Chinese section steel prices will climb up further in the coming period.