Posted on 12 Nov 2020
Shagang Group, China’s largest rebar producer, has hiked its rebar prices by Yuan 300/tonne ($45.4/t) at one go for the domestic sales over November 11-20, or the sharpest incline so far this year to reflect the observable rises in China’s spot rebar prices of late and the boosed market sentiment in the early winter, according to market sources.
Shagang, the Jiangsu-based steelmaker in East China, has started raising its rebar prices since the start of November after having remained them unchanged over August 20-October, and the latest price adjustment has been phenomenal against the Yuan 50/t rise for sales over November 1-10, Mysteel Global noted.
With the latest adjustment, Shagang’s HRB400 16-25mm dia rebar price is at Yuan 4,250/t in terms of EXW and including the 13% VAT.
Despite the sharp price gains, Chinese steel market sources expressed little surprise, agreeing that Shagang’s move has been within expectation, just echoing what has been happening recently in China’s domestic spot steel prices recently.
China’s national price of HRB400 20mm dia rebar, for example, soared by Yuan 233/t from November 2 to Yuan 4,119/t including the 13% VAT as of November 10, according to Mysteel’s assessment.
“The major stimulator to the rebar prices are the exceptionally strong demand as well as the strengthening in raw material prices,” a Shanghai-based trader said.
In early November, Shagang raised it steel scrap procurement price by Yuan 100/t starting November 5 shortly after the Yuan 50/t rise on October 3.
China’s coke price, for example, grew by a total of Yuan 300/t over mid-August and early November on the strong buying by the Chinese steel mills and at the same time limited supply, later on November 10, some independent coking plants in North and East China announced to raise another Yuan 50/t for coke selling, as reported.
For the rest of November, “personally, I foresee the demand to stay robust, as the domestic construction works will try to maintain their fast pace before the cold winter swipes China,” the Shanghai trader said.
Another Shanghai-based futures analyst agreed, adding that lower production has been supporting the rebar prices too. “The weekly average rebar supply had been high at around 3.9 million tonnes over June-August, but it has declined to about 3.6 million tonnes since last month,” he maintained.
Besides, “the market’s worry on capital tightness has mitigated recently, as the funding for specific use and general investment released in H2 have gradually flown into the related sectors and projects, which will see steel demand to pick up soon,” he added.
Not only rebar prices, Shagang has also added another Yuan 300/t to its list prices of wire rod and bar-in-coil for November 11-20 after an uptick of Yuan 100/t for both for the sales over November 1-10, which has Shagang’s price of HPB300 6-10mm high-speed wire rod to Yuan 4,510/t and HRB400 8-10mm bar-in-coil to Yuan 4,550/t, both in terms of EXW and including the VAT too.
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Shagang’s premiums for other long products over Nov 11-20 |
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Specification |
Premium |
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HRB400 10mm dia rebar |
Yuan 160/t |
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HRB400 12mm dia rebar |
Yuan 100/t |
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HRB400 14mm dia rebar |
Yuan 30/t |
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HRB400 28-32mm dia rebar |
Yuan 60/t |
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HRB400 36mm/40mm dia rebar |
Yuan 250/t |
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HRB500 14-25mm |
Yuan 300/t on top of HRB400 base prices |
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HRB400 6mm dia bar-in-coil |
Yuan 300/t |
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Anti-seismic rebar |
Yuan 30/t |
Written by Anna Wu, wub@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
Source:Mysteel Global
