Stable local supply and lower demand have pushed domestic scrap prices down slightly in China, while the import market has remained at a standstill as suppliers have been reluctant to sell to China at the low price levels that customers have been demanding.
Average domestic HMS scrap prices in China are at RMB 3,611/mt ($559/mt) ex-warehouse, decreasing by RMB 22/mt compared to June 23, 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 |
3,710 |
574.5 |
-75 |
-11.3 |
|
Liupanshui,Guizhou |
3,525 |
545.8 |
0 |
0.3 |
||
|
Nanchang,Jiangxi |
3,590 |
555.9 |
90 |
14.2 |
||
|
Handan,Hebei |
3,790 |
586.9 |
-25 |
-3.6 |
||
|
Anyang,Henan |
3,590 |
555.9 |
-135 |
-20.6 |
||
|
Zhangjiagang,Jiangsu |
3,660 |
566.7 |
-10 |
-1.3 |
||
|
Jinan,Shandong |
3,410 |
528.0 |
0 |
0.2 |
||
|
Average |
3,611 |
559.1 |
-22 |
-3.2 |
During the given week, there were more local scrap supplies arriving in the spot market, and so steelmakers lowered their purchase prices for scrap. At the same time, steelmakers have implemented steel production restrictions ahead of the 100th anniversary of the founding of the Communist Party of China, exerting a negative impact on scrap prices. The rebounding trend in the steel market in the latter part of the given week has bolstered scrap prices to some extent. However, the high temperatures in the summer season will result in slacker demand, which will negatively affect scrap prices in China in the near future.
Meanwhile, buying activity in the import segment has continued to be at a standstill, chiefly due to the offer-bi mismatch. Specifically, bids for HS scrap from Chinese buyers in the northern regions have remained not higher than $520-530/mt CFR, while buyers in eastern China are hardly ready to pay $520/mt CFR. “At our earliest opportunity, we will resume business here, but this will be possible only when international prices crash. As of now, there are still no trades, with bids and offers being at the same level as they were a week ago,” a key China-based trader commented with regard to the current developments. Meanwhile, Japanese scrap exporters have remained firm in their stance, being satisfied with demand in the local market and in South Korea. Accordingly, customers in South Korea are ready to pay the equivalent of $560/mt CFR for HS scrap from Japan, SteelOrbis has learned.
$1 = RMB 6.4601