Posted on 14 May 2021
ABSTRACT
Profits among the 91 Chinese blast-furnace steel mills sampled as part of Mysteel’s monthly tracking continued to grow in April, thanks to the rally in finished steel prices and despite the rise in the mills’ production costs last month.
During April, the sampled mills’ profit margins on rebar reached Yuan 719/tonne ($112/t) on average, up another Yuan 253/t from the prior month, while those on sales of hot-rolled coil (HRC) posted larger on-month growth of Yuan 328/t to average Yuan 1,165/t, according to Mysteel’s latest survey released on May 12.
Profits on sales of medium plates among the surveyed steel producers registered Yuan 1,221/t last month, surging by Yuan 464/t from the margin for March, the survey showed.
The continuous gains in domestic mills’ profits in April were mainly attributed to the strong finished steel market. Last month, domestic steel prices enjoyed a substantial uptick, Mysteel Global noted, propelled by firm demand from end-users and by market expectations of lower production this year on Beijing’s reiterations regarding steel output limits.
As of April 30, the national price of HRB 400 20mm dia rebar, a bellwether of China’s steel-market sentiment, was assessed by Mysteel at Yuan 5,255/t including the 13% VAT, increasing by Yuan 353/t from the end of March. During the same period, that of Q235 4.75mm HRC jumped by Yuan 407/t to Yuan 5,748/t including the VAT.
Mysteel’s other survey among 237 trading houses across China showed that in April, their daily trading volume of construction steel comprising rebar, wire rod and bar-in-coil averaged 260,471 tonnes/day, gaining 55,113 t/d or 26.8% on month and indicating the firm demand in the traditional peak season for steel consumption in spring.
Last month, the domestic steel mills’ steelmaking costs reversed up after their fall in March, with the molten iron cost among the 91 BF mills increasing by Yuan 97/t on month to Yuan 3,027/t excluding the 13% VAT, mainly due to the higher iron ore prices, according to the survey.
During April, Mysteel SEADEX 62% Australian Fines prices averaged $179/dmt CFR Qingdao, up $12.5/dmt from that for March. The growth offset some decline in the price of secondary metallurgical coke in North China, which averaged Yuan 2,107/t last month, down Yuan 260/t on month, the monthly survey showed.
Source:Mysteel Global
