Posted on 24 Jul 2024
Billet prices in Tangshan in North China's Hebei province decreased over July 15-19 as prices were dragged down by the softening rebar futures prices during the latter part of last week, according to Mysteel's weekly survey. Survey respondents pointed out that the fundamentals of the semis remain weak, despite a small drop in billet output and an uptick in demand from re-rollers.
As of July 21, the Tangshan Q235 150mm square billet price under Mysteel's assessment, had dropped by Yuan 30/tonne ($4.1/t) on week to Yuan 3,270/t EXW and including the 13% VAT.
Meanwhile, daily billet consumption among the 48 re-rollers in Tangshan under Mysteel's tracking over July 11-17 edged up by 2,400 tonnes/day on week to average 36,800 t/d, as demand for the semis increased slightly with a small gain in the capacity utilization rate of these re-rollers.
But survey respondents predicted that billet demand would hover at a low level this week, pointing out that re-rollers may halt operations due to the high steel stocks and tepid sales of finished steel lately.
As of July 17, the sampled 48 re-rollers saw their billet stocks thin for the second week, falling by 7,200 tonnes on week to 342,400 tonnes. The re-rollers' enthusiasm for purchasing the billets remained low in general, according to the survey.
On the other hand, total billet stocks across the four commercial warehouses and two ports in Tangshan that Mysteel monitors hit a near four-month high of 1.2 million tonnes as of July 18, higher by another 52,000 tonnes on week.
On the supply side, daily billet output among the 25 steelmakers in Tangshan that Mysteel canvasses slipped by 3,300 tonnes on week to average 42,200 t/d over July 12-18, as some mills had curtailed their production due to poor billet sales, according to the survey.
The price drop in the semis expanded the losses borne by local billet makers, with the average loss on billet sales endured by the ten integrated mills in Tangshan Mysteel monitors widening by Yuan 8/t on week to Yuan 106/t by July 19.
However, the average per tonne cost these mills had incurred when producing the billets eased by Yuan 12/t on week to Yuan 3,376/t including the 13% VAT last week, the survey found.
Source:Mysteel Global
