Posted on 23 Dec 2021
Arrivals of imported steel semis in China totaled 1.82 million tonnes in November, the highest since September 2020, the latest detailed statistics from China's General Administration of Customs (GACC) showed. The robustness of China's domestic market in late summer had prompted enthusiastic buying among local traders and end-users, market sources noted.
Most of the cargoes arriving at Chinese ports in November were for orders signed in September, when "the domestic market had performed relatively well" and the price gap between the domestic and overseas markets provided Chinese importers with opportunities, according to a Shanghai-based analyst.
On September 30 for example, Mysteel's data show that the price of Q235 150mm square billet in Tangshan, the country's top billet supply base in North China's Hebei, had stood at Yuan 5,210/tonne ($817.9/t) EXW and including the 13% VAT. This compares with the transaction price of imported 5SP 150mm square billet assessed by Mysteel the same day of only $700/t CFR China.
But importers were unable to make profits from the frenzied buying earlier. Instead, last month they were busy trying to resell the imported goods to buyers in other countries because of sharp price plunges in China's steel market.
"A large portion of the billets were immediately diverted to other countries after arriving in China," the Shanghai analyst said.
Some importers even successfully resold the products before they sailed to China. "We sold our products for only $650/t, but it was still better than selling domestically with the price at only around $600/t," a steel importer based in East China's Zhejiang province had admitted to Mysteel Global early last month.
Chinese steel prices took a nosedive in November amid growing pessimism about the domestic economy, especially the property sector. As of November 30, the Tangshan billet price had retreated to only Yuan 4,290/t EXW and including the VAT, down Yuan 610/t on month.
Last month's import result means that China's steel semis imports over January-November totaled 12.5 million tonnes, a recent-year high, as Beijing has been encouraging the import of steelmaking raw materials and semi-finished steel. But the volume over the eleven months was still down 28.2% on year due to an exceptionally high basis of 2020, according to GACC.
Source:Mysteel Global
