Posted on 17 Mar 2021
The Tangshan Q235 150mm square billet price, the bellwether of China’s steel market, refreshed a 9.5-year high last week to hit Yuan 4,430/tonne ($681.5/t) EXW and including the 13% as of March 12. Respondents to Mysteel’s survey cited the significant reduction in supply to explain the rise.
Over March 8-11, daily supply from the 29 steel mills in Tangshan in North China’s Hebei province, and in nearby areas averaged 21,000 tonnes/day, falling by a massive 25,500 t/d on week, as steelmakers in this top steel-producing city banked or damped down more blast furnaces, in a strengthened effort to combat heavy air pollution.
Between March 4 and noon on March 12, operations on another 31 blast furnaces had been suspended, which took the total to 70 – a number sufficient to slash Tangshan’s daily molten iron output by 99,100 t/d, Mysteel estimated.
Steel producers, together with other heavy industries in Tangshan such as cement manufacturers, have been under ever-escalating environmental protection restrictions since late February, due to the heavy air pollution hanging over this North China region for more than ten days, as Mysteel Global reported.
On the other hand, Tangshan’s steel re-rollers, the main consumers of the billets, took a short breather from the production ban and for two brief days over March 6-7 were actually allowed to produce. However, restrictions in the form of a new production ban were quickly slapped on them thereafter.
Yet despite the lack of clarity about when the new ban might be lifted, the re-rollers nonetheless still showed interest in purchasing feedstocks, a Tangshan industry source observed.
As of March 11, billet stocks at 14 trading houses in Tangshan totalled 772,000 tonnes, down for the second week and lower by 4,400 tonnes or 0.6% on week, the weekly survey showed.
Meanwhile, stocks of the semi-finished products at 53 steel re-rollers reversed down from last week’s record high since June 2020, the survey findings indicated. As of March 10, the stocks total was lower by 3,300 tonnes or 0.5% on week at 683,600 tonnes.
Source:Mysteel Global
