Export trade in rolled metal improves in China

Steel export prices in China fell from September 14-18, the first drop since early May, as steel suppliers, especially traders, cut their supply when domestic demand fell, Mysteel's latest weekly survey showed. According to respondents, export trade increased after the price gap between Chinese goods and those of competitors narrowed.

Last week, Mysteel estimates that China's export price for 4.75mm SS400 Hot Rolled Coil (HRC) fell $ 2 /t to $ 519 /t on FOB North China Tianjin Port, while the bid price for rebar B500B 18-25 mm remained unchanged. at the price of 487 USD /t on FOB terms East China port of Zhangjiagang.

“Domestic steel prices are steadily declining, affecting export offerings,” an industry source in Tianjin said, adding that this happened despite the rapid appreciation of the yuan against the US dollar, which could have led Chinese exporters to increase their dollar-denominated export prices to protect their yuan profits.

While export prices for Chinese steel fell sharply, foreign competitors, also targeting global buyers, raised their prices to reflect a rebound in international demand, according to the report. Consequently, the price gap between steel products of Chinese origin and those produced in other countries has become smaller or smaller, and the prices of some Chinese goods are even lower than those of their competitors.

“Last week the FOB price of the Chinese HRC was about $ 510 per tonne, while in India the FOB price of the same product was up to $ 525 per tonne,” a market observer from Beijing told Mysteel Global. Mysteel's weekly poll also revealed that the Chinese SAE1006 HRC was offered at $ 535-540 per tonne CFR in Vietnam last week, while the SAE1996 HRC from Japan to Vietnam was offered at $ 549 per tonne CFR.

“Business in China’s domestic steel market has been weak lately, and most traders are pessimistic about the fundamentals of the fourth quarter steel market, so it is possible that the export price will fall further,” suggested a source in Beijing.

Another consequence of the narrowing export price gap is that steel imports to China have recently dropped significantly. “Last week there were almost no orders for semi-finished products,” a source in Beijing said. The main steel products that China imports this year are mainly steel semi-finished products and HRC.