The weak trend in the finished steel market has put pressure on scrap prices in China with local prices showing some declines. The trading in the import segment has remained limited as the majority of sellers have been finding better realizations in trades to other destinations, like South Korea for instance.
Average domestic HMS scrap prices in China are at RMB 3,633/mt ($562.4/mt) ex-warehouse, decreasing by RMB 19/mt compared to June 16, according to SteelOrbis’ information.
Average scrap prices in China’s main markets are presented in the following table.
|
Product name |
Specification |
Origin |
Price |
Price |
Weekly change |
Weekly change |
|
HMS |
> 6 mm |
Tianjin |
3,785 |
585.8 |
0 |
-4.9 |
|
Liupanshui,Guizhou |
3,525 |
545.6 |
0 |
-4.6 |
||
|
Nanchang,Jiangxi |
3,500 |
541.7 |
0 |
-4.6 |
||
|
Handan,Hebei |
3,815 |
590.5 |
-25 |
-8.9 |
||
|
Anyang,Henan |
3,725 |
576.5 |
-130 |
-25.1 |
||
|
Zhangjiagang,Jiangsu |
3,670 |
568.0 |
20 |
-1.7 |
||
|
Jinan,Shandong |
3,410 |
527.8 |
0 |
-4.4 |
||
|
Average |
3,633 |
562.3 |
-19 |
-7.7 |
During the given week, demand for steel from downstream infrastructure and manufacturing industry has slackened, resulting in the declines in demand for scrap. However, the iron ore prices have been at high levels, which will bolstered scrap prices to some extent. At the same time, supply of scrap has been in certain shortage, which may provide certain support to its prices in the near future.
Most purchases have been done in the local market recently as bids of Chinese customers for ex-Japan HS scrap have not been good enough for suppliers, which chose to sell to other destinations, South Korea in particular. The tradable level for most of Chinese buyers for HS scrap is at $520-540/mt CFR, being stable compared to last week. Most buyers from the east of China are bidding not above $520/mt CFR.
But at the same time, buyers from South Korea may pay equivalent to $560/mt CFR for HS scrap from Japan, being more attractive for sellers. “Still nothing traded to China, the price from Japan to Korea is still $30/mt or more above bids [in China],” a trading source said.
According to some sources, a cargo of shindachi scrap has been purchased by the company in South Korea at JPY 59,000/mt ($534/mt) FOB last week under the individual negotiations, even despite the official bid of Hyundai Steel is staying at JPY 57,000/mt ($516/mt) FOB. The freight from Japan to South Korea is assessed at not less than $36/mt.
$1 = RMB 6.4621