Strict production cut to curb surplus steel capacity and environment pollution has reduced nation’s export volumes to overseas nations.
Chinese Iron and steel price performance in H1CY18
1. Spot iron ore prices witnessed decline in H1CY18 by 4% to USD 70/MT, CFR. Mills located in northern China shifted interest to high-grade ore and increased pellet and lump feed in blast furnace.
2. Coking coal prices to China moved up by 15% in first half of CY18 to USD 223.46/MT CNF China against USD 194.43/MT CNF basis in H1CY17 owing to strong demand from Chinese buyers. Domestic met coke production observed a fall in first half of this year.
3.Chinese billet exporters remained less active, focusing more on domestic sales.However strong domestic market prevented them from lowering offers. Billet export prices also moved up by 28% in H1CY18 against H1CY17.
4.Chinese HRC export offers surged by 25% to USD 589/MT FoB China in H1CY18 amid higher domestic prices. Although domestic sales remained a preference, as average prices in eastern China stood at RMB 4,124/MT,higher by 18% in first half of CY18 against RMB 3,486/MT in same time period of previous year.Also,Chinese mills saw active buying interest for HRC from SE Asian nations.
5.Chinese re-bar export offers hiked by 24% in H1CY18 to USD 554/MT against first half of previous year. However domestic rebar price witness surge of 12% in first half of CY18.
6. Imported Manganese ore prices jumped by 23% in H1CY18 to USD 9.45/MT CFR China.
China-Iron and steel prices in H1CY18
| Commodity | Delivery | Size
/Grade | UnitPrices | H1
CY18 | H1
CY17 | Y-o-Y
(%) |
| CokingCoal | FoBAustralia | PremiumHCC | USD/MT | 209.79 | 183.24 | 14.48% |
| CokingCoal | CNFChina | PremiumHCC | USD/MT | 223.46 | 194.43 | 15.00% |
| Ironore | CNFChina | Fines,62,
Australia | USD/MT | 70 | 73 | -4% |
| Ironore | CNFChina | Lumps,64/63,
South Africa | USD/MT | 83 | 81 | 2% |
| ManganeseOre | CNFChina | Lump,
Mn:44% | USD/DMTU | 9.45 | 7.68 | 23% |
| ChromeOre | CNFChina | Conc40-42%,
S.Africa, | USD/MT | 225 | 316 | -29% |
| Billet | Ex-Tangshan | 150*150mm,
Q235 | RMB/MT | 3,599 | 3,023 | 19% |
| Billet | FoBChina | 150*150mm,Q235 | USD/MT | 535 | 418 | 28% |
| Rebar | Ex-Shanghai | 16-25mm,
HRB400 | RMB/MT | 3,863 | 3,460 | 12% |
| Rebar | FoBChina | Commercial
grade | USD/MT | 554 | 445 | 24.49% |
| Wirerod | FoBChina | 6.5mm | USD/MT | 574 | 449 | 27.83% |
| HRC | EasternChina(ex-warehouse) | 2.75mm,
Q235/SS400 | RMB/MT | 4,124 | 3,486 | 18% |
| HRC | FoBChina | 2.5mm
SS400 | USD/MT | 589 | 470 | 25% |
| CRC | FoBChina | 1.0mm
SPCC | USD/MT | 619 | 527 | 17.40% |
| Plates | FoBChina | 5-10mm,
SS400 | USD/MT | 595 | 457 | 30% |
Domestic prices mentioned above includes VAT@17%
Source-SteelMint Research
Chinese iron and steel statistics in H1CY18-
1.According to National Bureau of Statistics (NBS) China’s crude steel output registered growth of 7% to 450.06 MnT in H1CY18 against 419.02 MnT in corresponding time frame of previous year.
2.Chinese iron ore (including pellets) imports fell 3% in H1 CY18 on rising stockpiles at ports and steel output curbs.Iron ore stockpiles at Chinese major ports recorded at 157.6 MnT in the end of June. However iron ore production in China fell by 38% in H1CY18 against same time period of previous year.
3.Chinese finished steel export volumes plunged 14%Y-o-Y- Nation’s finished steel exports stood at 35.45 MnT in H1CY18 fell by 14% against 41.01 MnT in H1CY17.
4.Meanwhile met coke exports reduced by 19% on yearly basis to 4.88 MnT in H1CY18 against 4.09 MnT in H1CY17.
5.Coking coal imports to China moved up by 10% Y-o-Y basis-Imports of coking coal to China to 146.19 MnT in H1CY17 which was 133.25 MnT in same time period last year.
China: Imports & Exports of Steel in H1 CY18
| Particulars | Country | H1
CY18 | H1
CY17 | Y-o-Y(%) |
| Production |
| CrudeSteel | China | 450.06 | 419.02 | 7% |
| IronOreProduction | China | 390.57 | 637 | -39% |
| MetCoke | China | 212.58 | 220.58 | -4.00% |
| Imports |
| Coal | China | 146.19 | 133.25 | 10% |
| IronOre | China | 530.67 | 546.09 | -2% |
| Pellet | China |
| Steel | China | 6.363 | 6.8 | -6.47% |
| ChromeOre | China | 3.98 | 7.31 | -46% |
| Exports |
| MetCoke | China | 4.88 | 4.09 | 19% |
| Steel | China | 35.45 | 41.01 | 14% |
Quantity in MnT
Source-SteelMint Stats
Outlook for H2CY18- Few Chinese steel mills are currently focusing on steel production cuts for ongoing summer season from 20 Jul’18 to 31 Aug’18. These production cuts will be in addition to the winter production curbs of 10-15% imposed from Mar-Nov’18. This may lead to further reduction in export volumes from China.
Mills will continue to focus more on high grade iron ore and material like pellet which may push premiums further.