Posted on 10 Feb 2023
The losses on finished steel sales being incurred by China's blast-furnace steel mills eased somewhat in January, mainly thanks to the recovery in domestic steel prices, Mysteel's latest monthly survey among the 91 sampled blast furnace steel mills shows. Their production costs increased further however, the findings show.
Last month, the average loss that mills under Mysteel's survey were having to bear on their rebar sales was Yuan 11/tonne ($1.6/t), lower by Yuan 41/t from the average for December, while that on sales of hot-rolled coil decreased by Yuan 42/t on month to Yuan 67/t.
Similarly, the average loss that the surveyed steelmakers were enduring on medium plate also narrowed to Yuan 80/t in January, as against the Yuan 108/t loss in the previous month, the survey showed.
The mitigated losses were mainly attributed to the rises in finished steel prices in January, as domestic steel producers preferred to raise their list prices to offset losses they had suffered earlier, though demand from end-users was tepid last month due to the Chinese New Year holiday over January 21-27, Mysteel Global noted.
For January, the national price of HRB400E 20mm dia rebar, a bellwether of domestic steel-market sentiment, was assessed by Mysteel at Yuan 4,252/t including the 13% VAT on average, higher by Yuan 191/t from the prior month.
However, domestic steel producers failed to get out of the red entirely last month as higher prices of imported iron ore had increased their production costs, Mysteel Global learned.
During January, the cost for making hot metal among the 91 surveyed mills averaged Yuan 3,082/t excluding the 13% VAT, up another Yuan 54/t or 1.8% from the previous month.
Last month, Mysteel SEADEX 62% Australian Fines index averaged $123/dmt CFR Qingdao, gaining $12/dmt on month, while the price of class 2 metallurgical coke in North China under Mysteel's assessment had slipped by Yuan 41/t on month to average Yuan 2,732/t, according to the survey.
Source:Mysteel Global
