Jiangsu-based Shagang Group, China’s largest private steelmaker, has announced that as of March 23 it has cut its scrap purchase prices by RMB 50/mt (7.7/mt), signaling its bearish view of the future prospects for the market. Accordingly, Shagang’s heavy scrap purchase price has declined to RMB 3,400/mt ($523/mt).
Shagang Group had raised its scrap purchase prices by RMB 100/mt (15.5/mt) on March 2.
The tradable price level for imported scrap in China has remained under pressure from lower bids and high freight costs together with transportation issues in Japan. The workable level for Japanese HS scrap has gone down by $5/mt compared to late last week to $465-470/mt CFR. But suppliers have mainly withdrawn their offers, seeing a sharp increase of RMB 130/mt ($20/mt) in the local billet market in China since Friday, which may help to push up scrap prices in the near future.