Japan’s steel exports decreased by 4.6% to 29.91 mn t in CY2020, against 28.55 mn t in CY2019. South Korea stood as the largest importer of finished long products during the year at 0.75 mn t, up 4.2% y-o-y. China stood as the largest importer of finished flat materials at 3.97 mn t, down by 1.24% y-o-y. Taiwan is the largest importer of billets at 1.24 mn t, down by 6% y-o-y.
Blast furnace capacity utilization rate among China’s 247 steel mills nationwide under Mysteel’s survey reversed down after two weeks of inclines over July 16-22, though the on-week drop was minor at 0.51 percentage point to 88.04%, as some steel mills in China had already started trimming their output on the instruction of their local authorities as part of the efforts to rein in the national steel output.
Over the survey period, these mills’ molten iron output ebbed marginally too by 13,500 tonnes/day on week to 2.34 million t/d in total, while the operational rate of their blast furnaces under the survey slid down for the second week by another 1.04 percentage points on week to 75.65% as of July 22, as more had been on maintenance, Mysteel’s data showed.
“Several steel mills in East China’s Jiangsu and Shandong have banked their blast furnaces under their government orders to reduce production,” a survey conductor explained.
China’s central government had mandated that crude steel output in 2021 should be below the level of 2020, as reported.
Lower blast furnace engagement led to less finished steel output too, as suggested by Mysteel’s other survey among China’s 184 mills, which showed that their production of the five major steel products comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate reversed down to a four-month low of 10.3 million tonnes over July 15-21 after a short-lived rise in the prior week, or dropping 3.3% on week.
Lower output in both crude and finished steel, in turn, lent support to China’s domestic steel prices, and as of July 22, China’s national price of HRB400E 20mm dia rebar under Mysteel’s assessment gained for the third week by another Yuan 75/tonne ($11.6/t) on week to Yuan 5,342/t.
The concern on less demand for iron ore in the coming weeks, however, saw Mysteel SEADEX 62% Australian Fines decreased by $17.2/dmt on week to $201.4/dmt CFR Qingdao, or a low since May 31
During the survey period, daily imported iron ore consumption among the 247 steel mills, accordingly, decreased by 10,000 t/d on week to 2.89 million t/d on average, and by July 22, their inventories of imported iron ore in all forms including the volumes at steelworks, port stockyards and on the water grew for the third week by another 201,200 tonnes on week to 115 million tonnes, which would be sufficient for 39.8 days of consumption, or up 0.21 day on week.
Over July 16-22, Mysteel’s other survey among a smaller sample of China’s 163 steel plants showed that their blast furnace capacity utilization decreased for the second week by 1.48 percentage points on week to 69.08% as of July 22.
Written by Lindsey Liu, email@example.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
Shyam Steel Industries, one of the leading TMT rebar manufacturers in India, is planning to invest INR 700 crore in brownfield expansion of its Mejia plant in Bankura district, West Bengal, the company’s Group Director, Keshav Beriwala, informed. The project is expected to get completed by FY’23 and will provide jobs to 5,000 people.
“Land procurement has already been completed for the project. Work on the expansion of the unit has started….,” Beriwala said.
He said the project will be funded through internet accruals and debt.
“We are a debt-free company but for the expansion, we will go for some borrowing,” he added.
After completion of the expansion project, the production capacity of the Mejia plant will increase to 500,000 tonnes (t) from 200,000 t at present. It will also expand the group’s manufacturing capacity to 900,000 t by FY’23.
The company is also planning to ramp up production capacities of its sponge iron and billet plants and rolling-mill by nearly three times to increase production of construction steel.
Further, the group is actively looking at options to participate in the bidding process for iron ore mines to insulate itself from raw material price fluctuations and uncertainties. It also has coal blocks in the state, Beriwala said.
Shyam Steel currently has four fully operational steel manufacturing units in West Bengal — a DRI unit, a steel melting shop equipped with electric arc furnace, a continuous billet casting unit and a rolling mill with thermex system.
Shyam Steel will invest INR 700 crore for brownfield expansion of its West Bengal plant, the company said on 23 Jul’21. The company aims at completing the expansion plan by FY’23. The project will help the rebar producer increase its TMT bar manufacturing capacity to 0.5 mn t from 0.2 mn t/year at present. It will also expand the group’s manufacturing capacity to 0.9 mn t by 2023. Shyam Steel is ramping up sponge iron, billet and rolling mill capacities by almost three times. Moreover, it is looking at options to participate in the bidding process for iron ore mines.
Induction furnace (IF) route rebar prices declined further by INR 100-400/t today in most markets in the north, east and central parts of the country, SteelMint assessment reveals. Rebar manufacturers in the western and southern regions kept prices stable, offering trade discounts depending upon buying enquiries. Weak semi-finished steel sentiments and dull buying interest owing to heavy rainfall in many cities lowered trade activities in the spot market. Going forward, rebar prices are expected to remain under pressure, SteelMint notes.
Domestic rebar prices in Nepal increased by NPR 3,000/tonne (t) ($25/t), following a rise in billet import offers by $15/t, w-o-w. However, local finished steel demand remained low due to seasonal slowdown in construction works, sources based in Kathmandu said.
Current offers for 10-16 mm rebars floated by mid-sized plants are reported at NPR 78,000-79,000/t ($655-664/t), while those from the major mills producing premium brands are at around NPR 81,000-82,000/t ($680-689/t). Prices are on an ex-works basis, excluding VAT and ED.
Demand for Indian billet improves
Nepal’s re-rollers resumed purchases of raw materials with the beginning of the new financial year. SteelMint confirmed around three rakes of billet deals to Nepal this week, of which one was from the mid-sized plants, ie, IF-grade, while the other two rakes have been concluded by primary mills for BF-grade.
- The deal price for the IF-grade billets (of 2,700 t) was reported at around $565/t exw-Odisha (loaded to rake), equivalent to $590/t CPT Nepal.
- BF-grade billet deals were reported at around $610/t exw (loaded to rake), equivalent to $630/t CPT Nepal.
- Fresh offers via road delivery from Durgapur based plants have been reported at $560-565/t exw, equivalent to $590/t CPT Nepal. Prices gained by $15, w-o-w, due to a rise in Indian domestic steel prices.
However, demand for wire rods remained poor as no fresh deals via rake delivery have been heard. Current offers are floated at around $615/t exw-Durgapur, equivalent to $640-645/t, CPT Nepal.
Induction furnace route rebar prices increased in most of the major markets by INR 100-400/t d-o-d except in Raipur in central India. As per trader sources, despite limited trades and buying enquiries, rebar prices remain strong owing to minor fluctuations in semi-finished steel prices and moderate transactions in rebar over the last couple of days. TMT prices in the near term are expected to fluctuate slightly depending upon billet prices.
An integrated steel mill has concluded another export deal of 50,000 t of rebar to Hong Kong for Aug’21 shipment at around $735/t CFR on AW basis, SteelMint learnt from sources. The freight rate from India to HK is assessed at around $40/t. Steel exports by India were recorded at 2 mn t in Jun’21, as per latest SteelMint reports. Flat steel exports were at 1.25 mn t, while long steel products exports stood at 0.25 mn t.
Chinese steel producers showed less interest in exporting steel last week amid mounting concerns that the central government may impose new export taxes, according to Mysteel’s latest weekly report. In the meantime, they opted to raise export prices by a large degree.
As of July 16, the export price of SS400 4.75mm hot-rolled coil (HRC) increased for the second week, Mysteel’s assessment found, with HRC prices rising by a larger $27/tonne on week to $925/t FOB from North China’s Tianjin port. This compares with the sedate $10/t on-week climb seen over the prior week.
The export price of B500B 16-25mm rebar also assessed by Mysteel reversed up $13/t on week to $782/t FOB from East China’s Zhangjiagang port as of July 16.
Chinese steel mills were not active in offering prices, worrying that export taxes could be imposed anytime in the near future, according to a Shanghai-based market insider.
“On the one hand, people are expecting crude steel output in China to decline, while on the other, China’s June exports remained high. Both factors increase the possibility that steel export taxes will be imposed,” she said.
Several steel producers in East China’s Jiangsu province, China’s second top steel producing province, were heard to have already received local government notices requesting them to rein in production in H2, in order to make sure output this year declines on year, according to Mysteel’s latest survey.
“Steel mills will have to reconsider the volumes they allocate for export, given that their output will be curbed this half,” an official with a steel mill in Jiangsu commented. “They have to readjust their production arrangements as well, in order to maximize profits and efficiency.”
Outside China, Russia will be adding new taxes on ferrous and non-ferrous products from August 1, with a base rate of 15%, and Vietnam is also planning to impose a 5% tax on semis exports in order to cool down the local steel market and lower the cost for steel end users, according to local media reports.
As for China’s imports of steel billets, trading was more active last week compared with the prior week. According to Mysteel’s tracking, the transaction price of imported billets, sourced mainly from Iran and Indonesia, was $685-690/t CFR China.
Written by Olivia Zhang, firstname.lastname@example.org
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
Gujarat-based Mono Steel India Ltd (Mono TMT Fe 500) has increased rebar offers today by INR 600/t. The current offer for 12mm rebar is at INR 49,100/t FoR Ahmedabad (excluding GST). Notably, the company has raised rebar price by INR 1,400/t this week. Higher raw material costs along with improved buying enquiries and trade for rebar in the spot market resulted in hike in offers, sources told SteelMint. The company has a rolling capacity of 0.22 mn t/year.