Average scrap prices in the Chinese domestic market have been almost stable compared to the previous week amid rises and declines being seen in different regions of China, while Shagang Group has announced some slight increase in its purchasing prices after a long-lasting decline. Nevertheless, the situation in the Chinese scrap market has been far from positive since the steel prices in the domestic market have continued to go down, scrap imports have been halted.
Average domestic HMS scrap prices in China are at RMB 2,493/mt ex-warehouse, moving down by RMB 2/mt on average compared to May 17, 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 |
2,575 |
366.1 |
10 |
-2.9 |
|
Liupanshui, Guizhou |
2,430 |
345.5 |
-50 |
-11.3 |
||
|
Nanchang, Jiangxi |
2,480 |
352.6 |
-10 |
-5.6 |
||
|
Handan, Hebei |
2,530 |
359.7 |
-15 |
-6.4 |
||
|
Anyang, Henan |
2,520 |
358.3 |
20 |
-1.3 |
||
|
Zhangjiagang, Jiangsu |
2,520 |
358.3 |
50 |
3.0 |
||
|
Jinan, Shandong |
2,395 |
340.5 |
-20 |
-6.9 |
||
|
Average |
2,493 |
354.5 |
-2 |
-4.5 |
||
|
Note: Prices include 3 percent VAT as of March 1 2022. |
||||||
During the given week, scrap prices have indicated a fluctuating trend amid the tight supply of resources, resulting in the pace of consumption scrap on hand being faster than the pace of scrap arrivals. Meanwhile, inventory of scrap indicated continuous decreases, exerting a positive impact on the transaction activities. Recently, steelmakers’ profitability improved slightly, while still on the verge of breaking even, which will affect the scrap market. On May 20, Shagang increased its HMS 1, 2 and 3 grades scrap by RMB 30/mt to RMB 2,860/mt ($405/mt), RMB 2,830/m ($401/mt) and RMB 2,800/mt ($397/mt) delivered, including 13 percent VAT, respectively. However, taking into account depreciation of the local currency, the dollar-based prices have lost $2/mt compared to the previous revision on May 12.
It is expected that scrap prices in the Chinese domestic market may fluctuate within a limited range in the coming week, but there have been no predictions for visible improvement since the steel market is weak and keeps falling.
The latest tradable ex-Japan HS scrap prices have been heard at JPY 50,500/mt ($366/mt) CFR, remaining stable in JPY compared to that recorded on May 17, while down $3/mt in dollar equivalent over the week.
$1 = RMB 7.056