Chinese Steel Market Highlights - Week 12, 2019

Spot iron ore prices recovered towards week end with Vale's announcement of suspension at Alegria mines, however spot pellet premium observed a significant fall of around USD 4/MT.

Chinese spot iron ore prices - Chinese spot iron ore prices opened up this week at USD 86.20/MT, CFR China then fell to USD 84.05/MT towards mid of this week and then increased to USD 86.8/MT towards the weekend. The price increase towards weekend remained supported by global supply shortage caused due to operation suspension at Vale’s Dique III and Alegria mine during the week. Iron ore inventory at major Chinese ports have increased to 148.6 MnT this week as against 148.2 MnT a week ago.

Spot lump premium witnessed drop to USD 0.3465/MT, CFR China as against USD 0.3660/DMTU a week ago. The lump premium has dropped amidst reduced sintering controls due to weather improvement in China.

Spot pellet premium down by USD 4.45/MT this week- Spot pellet premium for Fe 65% grade pellets have dropped this week due to falling fines prices to USD 32.30/MT, CFR China, against USD 36.75 /DMT a week before. Chinese pellet port stock inventory increased to 5.2 MnT this week compared to 5.1 MnT towards last weekend.

Coking coal prices edge down - Seaborne metallurgical coal prices after remaining stable for most part of the week have seen a marginal correction towards weekend. Latest offers for the Premium HCC grade are assessed at around USD 212.5/MT FOB Australia.

Chinese domestic billet prices fall towards week close- Domestic spot billet prices in China’s Tangshan closed this week at RMB 3,490/MT (ex-works, including VAT) down by around RMB 50/MT D-o-D. Prices has moved up towards the beginning of the week as local stockiest replenished inventories.

Chinese HRC export prices marginally down towards week close - HRC export offers after observing increase, exhibited a downtrend towards the week end. Currently Chinese HRC export offers are assessed at around USD 535/MT FoB basis.However in the beginning of the week HRC export offers stood around USD 535-540/MT FoB China.

Domestic prices in eastern China (Shanghai) remained mostly stable and stood at RMB 3,870-3,890/MT.

Chinese Rebar prices up in domestic & exports market - Currently, nation’s rebar export offers are at USD 530/MT FoB China. Last week the offers was in the range of USD 525-530/MT FoB basis.

Meanwhile domestic rebar prices moved up on W-o-W basis and is assessed at RMB 3,890-3,920/MT in (Eastern China). Last week the prices stood at RMB 3,810-3,850/MT inclusive of VAT taxes. Inventory levels in spot market fell which resulted in hike in Rebar prices in spot market.

China's major steel maker - Shagang Steel raised long steel prices for late March by RMB 40-50/MT.  Shagang is selling HRB400 16-25 mm dia rebar at RMB 4,050/MT up RMB 50/MT . While that for HPB 300 6.5 mm dia wire rod holds at RMB 4,140/MT, up by RMB 40/MT. All prices are on an ex-works basis, including VAT.