Posted on 11 Dec 2020
Baoshan Iron & Steel Co (Baoshan Steel), the listed arm of China Baowu Steel Group, announced on December 9 to raise its list prices of the carbon steel hot-rolled coil (HRC) substantially by Yuan 400/tonne ($61/t) for domestic sales in January, which has matched the overall strengthening in the HRC prices in and out of China, Mysteel Global noted.
Baoshan Steel’s latest pricing decision has been on the backup of the strong spot HRC prices lately and the market optimism in the near term, according to the Chinese market sources, and this has been the second month in a row for the Shanghai-headquartered company to raise its HRC prices after the increment by Yuan 100/t for December sales.
The price rise has been unusually sharp, but it has caused little ripples in the market.
“China’s domestic demand for cold-rolled products has been strong, thus the demand for HRC, the feeds for cold-rolling, is also robust,” a South China steel trader said, adding, “overseas demand has been recovering too, but supply has yet caught up, so the overseas HRC prices have been surging.”
Besides, the active booking from the end-users in the domestic market yet low HRC stocks at the traders and steel mills have prompted the Chinese steel prices to lift their list prices with great confidence, according to him.
As of December 9, China’s price of Q235 4.75mm HRC gained Yuan 305/t on month to Yuan 4,340/t including the 13% VAT, or a new high since September 21 2018, while as of December 3, HRC inventories at the commercial warehouses in China’s 33 cities declined 522,600 tonnes on month to 2.2 million tonnes, though the volume was still 422,200 tonnes higher on year, according to Mysteel’s survey.
The inventories at the 37 surveyed mills declined 91,400 tonnes on week to 935,500 tonnes as of December 2, or only 133,700 tonnes higher on year, the survey showed.
“In the near term, the demand for HRC in China will probably stay strong when the government is promoting the consumption of related products such as cars, and the undersupply in the global market may persist for a while,” an official from steel mill in North China said.
Baoshan Steel has increased all its key products prices for January sales, as other than HRC prices, it has increased its price of non-grain oriented electrical steel by Yuan 800/t, added Yuan 500/t to hot-dipped galvanized steel, cold-rolled coils and electrolytic galvanized steel, Yuan 300-600/t to its grain oriented electrical steel, Yuan 400/t to its colour-coated sheet, galvalume and pickled and oiled coils, and Yuan 300/t to its steel plate and sections, its pricing policy stated.
Written by Anna Wu, wub@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
Source:Mysteel Global
