China Steel Market Highlights in the Second Week of 2020
Mining News Pro - This week, the domestic steel prices witnessed a decline on the back of fluctuating futures in the domestic market. However, export offers remain largely supported over active trade inquiries from overseas buyers.
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According to Mining News Pro - Chinese HRC export offers moved up and rebar export offers inched down on a weekly basis. Restocking ahead of the Lunar New Year holidays weighed on Spot iron ore prices. Seaborne coking coal offers moved up over active buying from China amid increased buying interest in China.

This week, Baoshan Iron & Steel (Baoshan Steel), the listed-arm of China Baowu Steel Group, hiked its domestic sales list prices for carbon steel hot-rolled coil (HRC) further by Yuan 30/tonne cold-rolled coils by RMB 100/MT February. However, prices of hot-dipped galvanized steel prices remained unchanged for Feb deliveries.

Spot iron ore prices down during the week- Chinese spot iron ore prices opened up this week at USD 94/MT CFR China and dropped to USD 93.25/MT CFR China towards weekend amid sufficient restocking made ahead of Lunar new year holiday starting from 24th Jan.

However, prices picked up towards mid-week to USD 95.65/MT, CFR China, as on 9th Jan’20 due to anticipated supply constraints amid risks of flooding in Western Australia and Brazil.

As per the Mysteel data, Iron ore inventory at major Chinese ports dropped to 123.4 MnT this week, down 1.8 MnT against the previous week.

Spot pellet premium Up 10% W-o-W- Spot pellet premium for Fe 65% grade pellets increased to USD 27.45/MT, CFR China as against USD 24.95/MT, CFR China assessed last week. The prices improved amid increased bidding inquiries due to ongoing steel production curbs. Besides, the rising coke prices favored pellet demand.

Improved demand amid sintering curbs pushes Spot Lump premium up- For the week Spot lump premium has witnessed a slight rise to USD 0.2645/dmtu as against USD 0.2350/dmtu a week before. Lump demand in China towards winters is generally on the higher side due to sintering curbs.

Coking coal offer moved up amid improved buying- Seaborne coking coal offer witnessed an increase this week, driven by the strong buying interest in China.

Also, the prices are anticipated to remain firm in the short term amid better demand and tight supplies.

The latest offers for the Premium HCC grade assessed at around USD 148.00/MT FoB Australia, which was USD 141.00/MT FoB basis a week ago.

Domestic billet prices rise W-o-W- Chinese domestic billet market was settled at RMB 3,330/MT, up by RMB 30/MT against the previous week. The market sentiments in the country were reported strong.

China HRC export offer moved up on W-o-W- The Chinese origin HRC export offers remained largely firm during the week.

The current China HRC export offers stand at USD 495-500/MT FoB China, which was USD 490-495/MT FoB basis in the preceding week.

Meanwhile, the domestic HRC prices stood at RMB 3,870-3,900/MT (Eastern China) declined by RMB 30/MT W-o-W basis as compared with RMB 3,900-3,910/MT (Eastern China) against the previous week. The gradual winding down of the operations by downstream buyers ahead of the Chinese New Year holidays may keep HRC prices largely supported.

Rebar export offers down on falling domestic prices- This week, the Chinese rebar export offers inched down over low buying. Thus the current Chinese rebar export offer stood at USD 460-468/MT hovering near USD 462-470/MT FoB basis a week ago.

Meanwhile, domestic rebar prices slipped by RMB 20/MT to RMB 3,670-3,700/MT (Eastern China) as compared with RMB 3,690-3,720/MT in the preceding week. Falling temperatures also weighed on the prices.


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