Sources at the Fast Market told the Fast Market on Monday (July 19th) that buyers of steel ingots across Asia last week were faced with heavy bids from Chinese and non-regional buyers among Chinese customers. Continuation of this trend has caused the price of ingots in the Asian market to be accompanied by significant inflammations. We have already explained that China is thinking of building its own port and industrial infrastructure. In this case, it is better to produce the final products yourself. Therefore, we are witnessing a heavy thirst in the steel ingot market. In the following, we will describe these conditions in more detail. Be with Artan Press.
*** Chinese market developments and demand growth this week
The purchase price of steel billets in China rose sharply last week. Because many factories were expected to reduce production in the second half of the year. Chinese officials targeted 2021 steel production below $ 1.07 billion last year. Chinese buyers last week purchased several shipments with a 150mm 3sp (BF) blast furnace. China’s extravagance in this regard is unprecedented. We are the king who buys at different prices from the countries of the region.
China probably knows something that steel-producing countries are unaware of at the moment. That is why it is willing to incur significant costs. These costs include paying $ 703-705 per ton cfr China for raw materials from India, $ 705-707 per ton cfr from Vietnam and $ 710-713 cfr per billet from Indonesia. As of Monday, offers for the Indonesian 3sp BF 150mm bullion traded at $ 720-725 per tonne of Chinese cfr. Therefore, the offered prices can have an upward trend for the coming days.
*** Unfinished Chinese and Japanese tender for the purchase of steel ingots
A bid for 10,000 tonnes of Japanese 3mm, 150mm steel ingots was offered at around $ 710 per tonne cfr China on Monday, but a Japanese business source said the plant did not accept the sale and is now trying to Be interested in private negotiations with traders to be able to finalize the price of $ 715-720 per ton cfr.
It seems that the Japanese want to establish a win-win relationship with China in the game of buying steel. On the buying side in China, the turmoil in iron ore futures markets in recent days has led to a halt in the relentless uptrend last week. The difference in the prices of different Chinese stock exchanges has caused the calming of the buyers’ market to stop buying and the demand front to remain empty. This trend has led to a drop in the price of ingots in the country’s iron products due to rising prices.
*** Control of Chinese steel ingots demand from supply side
Yesterday, futures fell and sellers will not be able to receive [$ 715-720 per tonne in China]. Yesterday, bids were up to $ 710 per tonne cfr. An import source told Metal Bulletin on Monday that the latest weekly fast-market valuation for steel ingots, imports, cfr China, on July 16 is estimated at $ 703-715 per tonne. While $ 24 to $ 28 was higher from $ 675-691 per ton on July 9th.
*** Evaluate the Philippine market for Chinese market inflammation
Official sources told Metal Bulletin that the increase in Chinese ticket purchases has pushed the level of supply to major Southeast Asian markets such as the Philippines. Bids of $ 705 per tonne cfr Manila for Vietnamese Induction Furnace (IF) billet are a topic we saw in yesterday’s trading. The billet belt was traded in the Philippine market yesterday at $ 710-720 per tonne cfr. Sources said last week’s trading was at $ 690 a tonne in the Philippine CFR for arc furnaces, driven solely by China’s moves. The billet market is under pressure due to seasonal indicators in terms of sales. In the current situation, the offered level of prices is lower than the figures offered by the sellers, and in a way, the market is locked in this sector.
*** Possibility of postponing the correction of steel ingots prices in China
It was reported in the news that the prices of billets and ingots in China will be accompanied by price corrections next week. But for now, these analyzes are being questioned due to rising Chinese unilateral demand. The price of billet in Tangshan has again exceeded the cost of Chinese steel production. It was stated that the logical difference is between 250 and 300 yuan, and the cost of steel production should logically be higher than the price of billet Tangshan. Therefore, if the price of raw materials does not rise, the price of Tangshan billet is expected to improve in the coming weeks. But for now, this analysis will be delayed due to the stormy Chinese purchase in the market.
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