Scrap prices in the Chinese domestic market have continued to move down, with the pace of the decline accelerating within the past week. Overall, the prevailing bearish market sentiments and decreasing ferrous metal futures prices have been weighing on the scrap market. Specifically, lower finished steel prices have reduced the profits of Chinese steelmakers, with the consequent implementation of maintenance works and output reductions. In particular, since July 4 this year, Jiangsu-based Shagang Group, China’s largest private steelmaker, decreased its scrap purchase price by RMB 400/mt ($60/mt). On the other hand, some support for scrap prices in the coming weeks is expected from lower supply. With workable prices for import scrap having decreased in China by around $30/mt week on week to below $400/mt CFR this week, Chinese steelmakers appear to have focused on scrap purchases in the domestic market. No ongoing negotiations have been heard by the time of publication.
Average domestic HMS scrap prices in China are at RMB 2,711/mt ex-warehouse, moving down by RMB 164/mt compared to July 6, 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 |
2,755 |
409.4 |
-130 |
-23.2 |
Liupanshui, Guizhou |
2,480 |
368.6 |
-260 |
-42.3 |
||
Nanchang, Jiangxi |
2,740 |
407.2 |
-175 |
-29.9 |
||
Handan, Hebei |
2,770 |
411.7 |
-115 |
-20.9 |
||
Anyang, Henan |
2,730 |
405.7 |
-110 |
-20.1 |
||
Zhangjiagang, Jiangsu |
2,750 |
408.7 |
-205 |
-34.4 |
||
Jinan, Shandong |
2,755 |
409.4 |
-155 |
-26.9 |
||
Average |
2,711 |
402.9 |
-164 |
-28.3 |
||
Note: Prices include 3 percent VAT as of March 1 2022. |
$1 = RMB 6.7282