China's steel export sales remain weak

Steel export sales in China remained weak this week as lower demand from overseas buyers continued unabated and export prices for Chinese-origin steel products continued to be considered uncompetitive, Mysteel Global learned.

As of August 15, the export price of China-made 4.75mm (HRC) SS400 hot rolled coil was estimated at US$605/tonne FOB from North China's Tianjin Port, after rising by US$5/tonne the previous week. The cost of 1.0mm SPCC cold rolled coil also fell $5/t in the week to $677/t FOB from Tianjin Port, according to the Mysteel survey.

Last week, Chinese exporters lowered their bid prices for global sales given sluggish demand in overseas markets, leading to weekly declines. “Without any support from demand, export prices have lost momentum to further strengthen,” said a market source in Shanghai.

Although price volatility has led some foreign buyers to actively send inquiries to Chinese exporters, there have been few real deals. “The Asian steel market remains calm and many buyers in Southeast Asia are waiting for major local steelmakers to release their list prices after Baoshan Steel cuts its prices,” he added.

Baoshan Iron & Steel (Baoshan Steel), a subsidiary of China Baowu Steel Group, the world's largest steelmaker, announced on August 8 that the list price of hot-rolled carbon steel products has been reduced by another 100 yuan per tonne ($14.7 domestic sales in September after a previously announced price cut of 200 yuan/tonne for this month's sales as reported.

In addition, some Chinese steel mills and traders are not as keen on chasing global sales as prices for Chinese-origin steel products elsewhere in Asia were still relatively high despite this week's decline, Mysteel Global notes.

Domestic steel prices in China are fluctuating in a range as demand from local end-users declines due to this summer's scorching heat across much of the country.

For example, as of August 15, the national price for Q235 4.75 mm HRC was estimated by Mysteel at 4,123 yuan per ton, including 13% VAT, as of 15 August, down 5 yuan per ton from a week earlier.