Press releases

Anshan's November price cuts tipped to be severe - 17 October 2011

Anshan Iron & Steel (Angang) is likely to cut most of its prices when announcing its November list today amidst the softening market. Industry pundits treated to a preview of the north China mill’s pricing strategy last week say hot rolled coil prices were to be clipped by RMB 200-300/tonne ($31-47/t), cold rolled coil by RMB 350/t and plate by RMB 100-200/t.

Should Angang opt to reduce its November list prices markedly, few will be surprised, traders tell Steel Business Briefing. They say that, given the negative outlook for China’s steel sector for the remainder of this year, dealers are already reluctant to re-stock. Moreover, Angang’s October HRC and CRC list prices are currently RMB 300-400/t and RMB 200-300/t above spot market prices, they also note.

Spot HRC prices in the key east and south China markets have maintained their downward slide while traders hold ‘fire sales’ of stock. Offer prices of Q235 5.5mm HRC are currently about RMB 4,380/t in Shanghai, RMB 4,560/t in Guangdong Lecong and RMB 4,400/t in southwest China’s Chongqing. All prices include 17% VAT and represent drops of over RMB 100/t from the week of 10 October and of RMB 300-400/t from early September.

Shanghai and Lecong dealers aim to clear their HRC inventories to as thin as possible fearing the market chill will continue until year’s end.

Meanwhile, a Chongqing-based trader expects no demand recovery from private auto and auto-parts manufacturers this year though some state-owned firms should re-stock steel soon just meet 2011 vehicle production targets. But he says that softening steel prices are keeping these end users on the market sidelines and their purchases will also be limited.

Chinese domestic HRC prices ©SBB 2011
RMB/tonne
  Incl. 17% VAT Excl. 17% VAT
Shanghai 4,380 3,744
Lecong 4,560 3,897
Chongqing 4,400 3,761
 

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