Posted on 02 Mar 2022
Shagang Group, China's leading long steel producer headquartered in East China's Jiangsu, is cutting prices of its rebar, wire rod and bar-in-coil by Yuan 100-200/tonne ($16-32/t) for sales over March 1-10, the company announced on March 1, citing the slow recovery of steel demand among end-users.
With the latest cuts, Shagang's HRB400 16-25mm rods will be priced at Yuan 5,000/t, down Yuan 100/t from February 21-28, while the prices of both HHPB300 6-10mm wire rod and HRB400 8-10mm bar-in-coil have been clipped by Yuan 200/t to become Yuan 5,110/t and Yuan 5,200/t respectively, all in terms of EXW and including the 13% VAT.
"Though steel demand has gradually recovered after the Chinese New Year holiday, the pace has been slower than expected," a Jiangsu-based trader told Mysteel Global.
"The resurgence of COVID-19 cases in many regions of China, as well as the continuing tight liquidity that many end users are suffering, have hindered outdoor construction activities, resulting in the slower revival of steel demand," he explained.
Even though Beijing has adopted a succession of measures to increase domestic liquidity, construction projects are securing funding from banks and financial institutions only very slowly, Mysteel Global noted.
In late February, the trading volume of construction steel comprising rebar, wire rod and bar-in-coil across 237 steel traders nationwide sampled by Mysteel averaged 121,891 tonnes/day, much lower than the level of 160,000-170,000 t/d considered normal for a typical winter day, according to Mysteel's assessment.
Shagang's ten-day pricing policy is usually viewed as an indicator of spot market sentiment for longs, Mysteel Global notes. "The price volatility and slow revival of steel demand has made us more cautious about building up steel stocks," according to the trader.
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Shagang's premiums for other long products over Mar 1-10 |
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|
Specification |
Premium |
|
HRB400 10mm dia rebar |
Yuan 160/t |
|
HRB400 12mm dia rebar |
Yuan 100/t |
|
HRB400 14mm dia rebar |
Yuan 30/t |
|
HRB400 28-32mm dia rebar |
Yuan 60/t |
|
HRB400 36mm/40mm dia rebar |
Yuan 250/t |
|
HRB500 14-25mm |
Yuan 300/t on top of HRB400 base prices |
|
HRB400 6mm dia bar-in-coil |
Yuan 300/t |
|
Anti-seismic rebar |
Yuan 30/t |
Source:Mysteel Global
