Average scrap prices in the Chinese domestic market have continued their uptrend compared to the previous week after the PBOC cut the loan prime rate (LPR) by 10 basis points on June 20 and with mills still needing to attract scrap volumes.
Average domestic HMS scrap prices in China are at RMB 2,586/mt ex-warehouse, moving up by RMB 53/mt on average compared to June 14, 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 |
2,655 |
370.8 |
60 |
7.9 |
|
Liupanshui,Guizhou |
2,450 |
342.2 |
20 |
2.3 |
||
|
Nanchang,Jiangxi |
2,555 |
356.8 |
35 |
4.4 |
||
|
Handan,Hebei |
2,650 |
370.1 |
85 |
11.4 |
||
|
Anyang,Henan |
2,605 |
363.8 |
50 |
6.5 |
||
|
Zhangjiagang,Jiangsu |
2,655 |
370.8 |
60 |
7.9 |
||
|
Jinan,Shandong |
2,530 |
353.4 |
60 |
7.9 |
||
|
Average |
2,586 |
361.1 |
53 |
6.9 |
||
|
Note: Prices include 3 percent VAT as of March 1 2022. |
||||||
During the given week, ferrous metal futures prices moved up first, bolstering scrap prices to a certain degree. However, ferrous metal futures prices have indicated declines since June 19, with rainy weather negatively affecting market sentiments. Currently, inventory of scrap is at a relatively low level, with no easing of the supply shortage, and so most steelmakers have chosen to increase scrap purchase prices, aiming to attract more supply. On June 20, the People’s Bank of China (PBOC) cut the LPR by 10 basis points, providing support for the scrap market. It is expected that scrap prices in the Chinese domestic market will edge up in the coming week.
The highest ex-Japan HS tradable price levels have been at $380-390/mt CFR, up by $5/mt over the past week. But the last deal for HS from Japan to South Korea was done at JPY 53,000/mt FOB or $374/mt FOB, which means that Japanese exporters still have better options for sales other than China.
$1 = RMB 7.1795