According to Mining News Pro -Following hike in long steel prices for late August shipments by RMB 100-150/MT, Shagang has raised its scrap purchase prices by RMB 100/MT amid increased scrap usage on environmental regulations.
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) 100/MT (USD 15) today. After witnessing price hike of RMB 150/MT two weeks ago, the company has raised its prices further amid tightening supply-demand for finish steel in spot as well as export markets and continued production cuts.
As per latest reports, Shagang is now paying RMB 2,690/MT (USD 393) inclusive of 17% VAT for HMS (6-10 mm in thickness) delivered to its headquarter works situated in Zhangjiagang province in China, up RMB 100/MT as against last report of RMB 2,590/MT.
Notably, the company has witnessed four successive price hikes since 28th July in which prices have climbed up RMB 430/MT from temporary low hit at RMB 2260/MT on 30th May’18. The scrap prices have surpassed the last highest peak achieved at RMB 2680/MT on 22nd Dec`17 climbing eight months` high now.
In line with this, the steelmaker has also raised purchase prices for other grades of scrap by RMB 100/MT in the latest price revision and paying RMB 2770/MT (USD 405) for HMS 1 (thickness not less than 20 mm), RMB 2790/MT for charging scrap 1 and RMB 2730/MT for HMS 2 (6-10 mm). While new prices stand at RMB 2590/MT and RMB 2460/MT for melting scrap with specification 4-6 mm and 2-4 mm thickness respectively inclusive of 17% 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.
Domestic scrap purchase prices increase by USD 15-18/MT – In last couple of days, many of the leading scrap consuming steelmakers have raised their purchase prices successively by RMB 100-120/MT in eastern China while other leading steelmakers like Maanshan and Xingcheng are expected to revise the scrap prices soon.
Province-wise domestic scrap reference prices as on 22th Aug’18 –
| Domestic scrap HMS (6-10 mm), Prices in RMB/MT including 17% VAT |
| Province | Origin | Prices as on 22nd Aug`18 | Change against last report on 07th Aug`18 |
| Shandong | Jinan | 2,620 | 0 |
| Jiangsu | Zhangjiagang | 2,690 | 100 |
| Fujian | Fuzhou | 2,530 | 50 |
| Anhui | Maanshan | 2,650 | 0 |
| Zhejiang | Taizhou | 2,700 | 120 |
| Guangdong | Guangzhou | 2,550 | 50 |
| Tianjin | Tianjin | 2,660 | 0 |
| Hebei | Handan | 2,720 | 100 |
Source: SteelMint Research; Exchange Rate: 1 USD = 6.83 RMB
Shagang hiked finish long steel prices for late August shipments – The mill will sell its HRB 400 16-25 mm rebar at RMB 4,600/MT (USD 671) over the period 21st-31st August, up RMB 150/MT from last asking prices for products shipped during mid-August’18 at RMB 4,450/MT and up RMB 250/MT as against prices during early Aug’18.
In line with this, for its HPB300 wire rod, the mill has kept prices at RMB 4,680/MT (USD 657) over the same period, up RMB 100/MT from prices in mid-August. Both prices are on an ex-works basis, including VAT.
“Production cuts due to environmental issues in Tangshan pushed up spot prices sharply and increasing scrap consumption in steelmaking led to the bullish outlook for both scrap and finish product prices for the steel mill in late August” source shared.
