According to Mining News Pro -One of the largest ferrous scrap consumers in east China, Shagang Jiangsu Steel group has raised its domestic scrap purchase prices by Chinese Yuan (RMB) 60-80/MT (USD 9-12) today. After keeping prices unchanged for more than one and half months’ time, the company has raised its prices ahead of production cuts in the country, tightening supply of scrap amid extreme weather forecast and on the effect of trade dynamics in spot market.
As per latest reports, Shagang is now paying RMB 2,700/MT (USD 390) inclusive of 16% VAT for HMS (6-10 mm in thickness) delivered to its headquarter works situated in Zhangjiagang province in China, up RMB 60/MT as against last report of RMB 2,640/MT on 31st Aug’18.
In line with this, the steelmaker has also raised purchase prices for other grades of scrap by upto RMB 80/MT in the latest price revision. Shagang is paying RMB 2800/MT (USD 405) for HMS 1 (thickness not less than 20 mm), RMB 2820/MT for charging scrap 1 and RMB 2750/MT for HMS 2 (6-10 mm). While new prices stand at RMB 2600/MT and RMB 2470/MT for melting scrap with specification 4-6 mm and 2-4 mm thickness inclusive of 16% VAT.
Shagang Steel is one of the leading steelmakers in China and with an annual production capacity of 31.9 MnT iron, 39.2 MnT steel and 37.2 MnT rolled products.
The company observed scrap prices surpassing the CY17 highest peak achieved at RMB 2680/MT on 22nd Dec`17, by climbing eight months` high to RMB 2690/MT on 22nd Aug’18. While it has reached RMB 2700/MT levels the first time in last 1 years’ time now.
Domestic scrap purchase prices on uptrend in all major provinces - In last one and half months’ time, many of the leading scrap consuming steelmakers raised their purchase prices successively by RMB 60-150/MT in eastern China. Following Shagang’s lead, other major steelmakers like Maanshan and Xingcheng have also raised scrap prices by RMB 70-80/MT today.
Province-wise domestic scrap reference prices as on 15th Oct’18 -
| Domestic scrap HMS (6-10 mm), Prices in RMB/MT including 16% VAT |
| Province | Origin | Prices as on 16th Oct`18 | Change as against last report (31st Aug`18) |
| Shandong | Jinan | 2,740 | 90 |
| Jiangsu | Zhangjiagang | 2,700 | 60 |
| Fujian | Fuzhou | 2,710 | 220 |
| Anhui | Maanshan | 2,770 | 20 |
| Zhejiang | Taizhou | 2,750 | 100 |
| Guangdong | Guangzhou | 2,640 | 0 |
| Tianjin | Tianjin | 2,770 | 110 |
| Hebei | Tangshan | 2,790 | 70 |
Source: SteelMint Research; Exchange Rate: 1 USD = 6.91 RMB
Shagang Steel rolled over finish steel prices for mid-October shipments - The mill is selling its HRB 400 16-25 mm rebar at RMB 4,680/MT (USD 676) over the period 11th-20th October, unchanged for more than 1 months’ time since 11th Sept, however prices up RMB 80/MT from its asking price for products shipped during late Aug’18.
In line with this, the mill continues to sell HPB300 wire rod at RMB 4,760/MT (USD 687) over the same period as well, stable since last 1 month while up RMB 80/MT from prices in late Aug’18. Both prices are on an ex-works basis, including VAT.
Rebar prices fluctuated mildly after completion of golden week holidays, which participants cited as the reason for the mill to keep finish steel prices flat. Recent Rebar prices in eastern China were at RMB 4,540-4,580/MT, up RMB 20-30/MT from RMB 4,510-4,560/MT towards late Sept`18.
