Mr Xu Kuangdi, the former president of the Chinese Academy of Engineering, said at a symposium on Monday June 21 that using scrap in steelmaking would be an “effective and realistic” way for China to achieve carbon neutrality in the steel sector and it should be “strongly encouraged” nationwide, sources said.The symposium was organized by the China Iron & Steel Association (Cisa) for the national iron & steel industry to celebrate the centennial of the Communist Party of China.
The latest Chinese customs data shows a jump in scrap import volume during May 2021 – China imported 111,432 tonnes of steel scrap in May, more than the 109,978 tonnes the country imported during the first four months of 2021.
Despite high import volumes in May, interest for importing fresh steel scrap into China was limited on June 22 due to bearish sentiment in Chinese steel markets.
No new bids were heard, with the latest bid for heavy scrap (HS) coming in at only $510 per tonne cfr northern China, equivalent to about $500 per tonne cfr eastern China. Offers from Japanese sellers were strong at $580 per tonne cfr China amid robust domestic demand in Japan, sources said.
“We cannot break-even if we are to import scrap cargoes at current price levels. Some mills have lowered their purchase prices for domestic scrap, including us. The demand for finished steel products was weak in the rainy season and we cannot ignore the fact that the government wants everyone to keep steel prices stable,” a Chinese mill source in Hebei province said.
Market participants said that $530-550 per tonne cfr northern China, equivalent to $520-540 per tonne cfr eastern China, was the workable price for buyers on June 22.
“The acceptable price level for buyers will not lead to any deals taking place,” a Japanese exporter source said.
Fastmarkets’ daily price assessment for steel scrap, heavy recycled steel materials, cfr China, which takes into account prices at ports in eastern China, was $520-540 per tonne on June 22, unchanged day on day but widening downward by $10 per tonne from $530-540 per tonne on June 18.
Sentiment in Asia has become increasingly bearish in the last week, particularly with the downturn in seasonal demand and falling prices in the Chinese steelmaking market, sources said.
Taiwanese buyers expect prices to have limited upward movement after purchasing Australian containerized HMS 1&2 (80:20) at $450 per tonne cfr in the week to June 22, after offers for bulk Japanese H1&H2 (50:50) fell to $515 per tonne cfr Taiwan from $520 per tonne cfr Taiwan.
Offers for United States-origin containerized HMS 1&2 (80:20) were at $460-465 per tonne cfr Taiwan, although offers at $470 per tonne cfr Taiwan were also heard.
Vietnamese buyers remained quiet amid rising Covid-19 cases in the south of the country and falling steel prices in China limiting demand for Vietnamese billet imports.
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