The reduction in scrap consumption stemming from production curbs in China, coupled with lingering slump of iron ore prices have affected scrap prices in China this week. While local scrap prices have notably decreased, buying interest in import segment has dwindled almost to zero, with the latest offers having been heard at $580-600/mt CFR for ex-Japan scrap.
“Japanese scrap suppliers do not pay any attention to low bids from China, benefiting from the situation in the domestic market,” a China-based trader stated. Specifically, bids from Chinese steelmakers have been heard hardly higher $520-525/mt CFR, narrowing from $520-530/mt CFR voiced a week ago. On September 15, the China Association of Metalscrap Utilization (CAMU) has issued the 14th Five-Year Plan (2021-2025) for the country’s steel scrap industry, announcing the increase of the state’s consumption of scrap to 30 percent against 18.8 percent during 2016-2020 among the main targets. However, the impact remains to be seen.
On balance, average domestic HMS scrap prices in China have decreased to RMB 3,741/mt ($578.3/mt) ex-warehouse, down RMB 31/mt compared to September 15, 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 |
3,865 |
597.5 |
-35 |
-7.2 |
|
Liupanshui, Guizhou |
3,605 |
557.3 |
-15 |
-4.0 |
||
|
Nanchang, Jiangxi |
3,775 |
583.6 |
-25 |
-5.6 |
||
|
Handan, Hebei |
3,910 |
604.4 |
-10 |
-3.3 |
||
|
Anyang, Henan |
3,780 |
584.3 |
-20 |
-4.8 |
||
|
Zhangjiagang, Jiangsu |
3,670 |
567.3 |
-80 |
-14.1 |
||
|
Jinan, Shandong |
3,580 |
553.4 |
-35 |
-7.1 |
||
|
Average |
3,741 |
578.3 |
-31 |
-6.6 |
$1 = RMB 6.4693