Summary: Monthly Report of China Steel and Raw material Markets

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Summary: Monthly Report of China Steel and Raw material Markets

https://en.steelhome.com [SteelHome] 2009-04-07 16:01:49

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Steelhome website publishes monthly report of eight kinds of steel and raw material products including construction Steel, HRC/CRC, medium plate, stainless steel, iron ore, coke, scrap and ferroalloy on the 5^th of each month. If you are interested in SteelHome Monthly Report, please contact Annieli@steelhome.cn；Info@steelhome.cn, or dial 86-21-50585733/50585368/50585358

Summary:

Monthly Report on China HRC/CRC Market for Mar.2009

HRC/CRC market trend down concussively in March. Statistics from SteelHome website disclosed that up to Mar.31, average prices of 1.0mm CR coil gathered from 28 key cities stood at 4277 yuan per ton, 2.75mm HR coil at 3568 yuan per ton; and 5.75mm HR coil at 3379 yuan per ton, down 156 yuan per ton, 201 yuan per ton and 134 yuan per ton respectively. Overspeed recovery of steel capacity and slow growth in demand should attribute to the price downfall in March.

I HRC/CRC market spiraled down in March

I.1 HRC/CRC output bounced up in Feb. 2009

I.2 HRC/CRC export plummeted in Feb.2009

I.3 HRC/CRC supply increased in Feb.

II HRC/CRC market outlook in April

II.1 International demand contracted at the economy recession

II.2 Chinese economy turned better

II.3 Export policy revision to improve steel export

II.4 HRC/CRC inventory decreased slowly

II.5 Steel mills ran into loss again and have to slash production again

II.6 Slim chance to see further drop in HRC/CRC market

II.7 Raw material price unlikely to drop further

Table 1: SteelHome (China) Steel Price Index for March 2009

Table 2: HRC/CRC prices in key markets in March 2009

Table 3: HR coil ex-works price adjustment in March 2009 (Price in yuan per ton)

Table 4: CR coil ex-works price adjustment in Mar. 2009 (price in yuan per ton)

Graph 1: Average price of HRC/CRC in key Chinese market in 2008-2009

Graph 2: Monthly output of HRC in 2008-2009

Graph 3: Accumulative output of HRC in 2008-2009

Graph 4: Monthly output of CRC in 2008-2009

Graph 5: Accumulative output of CRC in 2008-2009

Graph 6: HRC monthly import and export in 2008-2009

Graph 7: CRC monthly import and export in 2008-2009

Graph 8: HRC supply and growth in 2008-2009

Graph 9: CRC supply growth in 2008-2009

Graph 10：Daily sales of HRC in Shanghai in 2008-2009

Graph 11: Steelhome China steel price index 2007-2009

Graph 12: Steelhome (China) raw material price index for 2007-2009

Monthly Report on China Construction Steel Market for March, 2009

China construction steel market in March sustained the downward curve of February and tended stable at the end of March. The production resumption rate of steel mills is obviously higher than the recover of steel demand. High supply pressure in home markets is the major reason that drags down construction steel in March.

I Construction steel market in March

I.1 Fast growth in steel supply is attributable to falling price

I.2 Construction steel demand recover slowly as real estate industry softens

I.3 Market inventory maintain high

II China construction steel market for April

II.1 Construction steel production remain high, but the government urges to accelerate the pace of washing out backward capacity

II.2 The softness in real estate industry will prevail, but the government’s domestic demand spark plan will help boosting construction steel demand

II.3 The launch of steel futures will impact on the curve of construction steel market

II.4 Money supply and credit issuances surge

II.5 Global longs price continue falling

II.6 Steel mills reduce ex-works price

II.7 Little downward room for raw material price

Table 1: China wire rod/rebar market price change in March

Table 2: Steel mills reduce ex-works price

Graph 1: Q235 6.5mm wire rod price trend in March 2009

Graph 2: HRB335 20mm rebar price trend in March 2009

Graph 3: China construction steel output and yearly growth in 2008-2009

Graph 4: Cumulative output of China bar & rebar and wire rod for 2008-2009

Graph 5: Daily production of China bar & rebar and wire rod in 2008-2009

Graph 6: China bear & rebar and wire rod import in 2008-2009

Graph 7: China bar & rebar and wire rod export in 2008-2009

Graph 8: China billet/slab import/export in 2008-2009

Graph 9: China bar & rebar and wire rod supply and growth in 2008-2009

Graph 10: Cumulative supply of China bear & rebar and wire rod in 2008-2009

Graph 11: China township fixed-asset investment in 2008-2009

Graph 12: Investment in real estate industry in 2008-2009

Graph 13: Wire rod and rebar market inventory in 2008-2009

Graph 14: China domestic Money Supply in 2008-2009

Monthly Report on China Iron Ore Market for March 2009

China iron ore price went down as much as 70-100 yuan per ton in March. Local mines showed that current iron concentrates price in domestic market had tumbled to cost, they had to slash delivery. Steel mills relied on previous imports.

Due to shrinking purchase, iron ore export quotation dipped persistently by US$ 14-15 to US$ 64-65 per ton (CIF) for 63.5 Pct Indian ore. Starting from April, steel mills intended to lower purchasing price of domestic ore to make it flat with import one. However, due to low operating rate of mines, steel mills argued that it’s difficult to pull iron ore price down further and held that iron concentrates price in April will maintain at low level.

I domestic iron ore market kept falling in March

II market analysis on iron ore market in April

II.1 Newly additions at domestic market to decline in April

II.2 Iron ore price at ports plunged as a whole

II.3 Ocean freight edged down

II.4 Iron ore inventory at ports climbed up enormously

II.5 China domestic steel price corrected at low level

II.6 FY 2009 international iron ore contract price talk is underway

II.7 Steel mills held wait-and-see attitude due to high expectation on the falling iron ore price

Table 1: China iron ore price of Apr.2008-Feb.2009

Table2: Steel Price Changes at domestic market (Taking Shanghai market as an example)

Graph1: China iron ore price trend in 2008-Mar.2009

Graph2: China iron ore output and import contrast in 2008-Feb.2009

Graph3: Price contrast between domestic and imported ore in 2008-Mar.2009

Graph4: International ocean freight trend in 2008-Mar.2009

Graph5: China iron ore import and inventory at ports in 2008-Mar.2009

Monthly Report on China Scrap Market for March 2009

In March, China scrap market weltered in downward spiral. Generally speaking, two factors caused the downturn in scrap market: one is sluggish domestic demand. A lot of small EAF-based steelmakers halted production in succession, and large-and-medium steelmakers mainly consumed scrap inventories in their warehouses. The other is steelmakers’ preference to international scrap market. On the decline of scrap price in international market, Chinese steelworks expanded the orders from overseas scrap suppliers, so as to offset the supply tension of domestic-produced scrap.

I Review on China scrap market of March 2009

I.1 Domestic scrap price in downtrend

I.2 Steelmakers’ scrap inventory & purchasing price adjustment

I.23 International scrap price declined

II Outlook on domestic scrap market in April 2009

II.1 Scrap supply in China to loosen

II.2 Scrap imports to trend up

II.3 Domestic scrap demand in lackluster

II.4 International scrap demand warm up

II.5 Related products price to decline

Table1: Scrap price adjustment of key steel mills in March (yuan per ton)

Graph1: HMS price in China main markets in March 2009