Posted on 29 Jul 2021
Mysteel SEADEX 62% Australian Fines fell below the $200/dmt threshold on July 27 after having persisted above the level since June 1, hitting $199.05/dmt CFR Qingdao as of Tuesday, or down $17.95/dmt on week, which was in sharp contrast to China’s domestic steel price movements recently, as the concern on steel mills’ demand has taken a toll.
China’s national price of HRB400E 20mm dia rebar under Mysteel’s assessment, rallied Yuan 130/tonne ($20/t) on week to Yuan 5,467/t as of July 27.
Source: Mysteel
The two markets have shown disparity in sentiment, as China’s wild-range steel production curtailing nationwide for the remainder of this year has triggered opposite reactions, with steel mills and steel traders raising their offering prices on the back of less supply in the coming months even though spot sales for now has been sluggish in the scorching summer.
Iron ore market concern, however, has been intensified on the expected lower demand from the Chinese steel mills and signs have already emerged, as the blast furnace capacity utilization rate among China’s 247 steel mills nationwide under Mysteel’s survey, for example, reversed from two weeks of inclines over July 16-22, down 0.51 percentage point on week to 88.04%
Mysteel’s latest survey also showed that rebar production among China’s 137 integrated mills and re-rollers declined over July 15-21, falling by 5.5% or 195,000 tonnes on week to 3.35 million tonnes.
Steel mills have also been reviewing their iron ore procurement strategy, especially with seaborne cargoes that will usually take 2-8 weeks to arrive as they are having iron ore port stocks to fall back on should their demand picks up.
As of July 22, the slow-down in consumption and higher new arrivals saw imported iron ore stocks at China’s 45 ports reached a high since May 6, or having gained for the fifth successive week by 3 million tonnes or 2.4% to 128.5 million tonnes, according to Mysteel’s data.
Source:Mysteel Global
