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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 or
before the 6th of each month. If you are interested in
SteelHome Monthly Report, please contact Info@steelhome.cn, or dial
86-21-50585733/50585368/50585358
Summary:
Monthly Report on China Construction Steel Market for June 2010
As
Eurozone debt crisis gave rise to worries on global economic growth,
regulation on real estate market triggered panic sentiments,
thunderstorm in Southern China pared market demand and financial market
swung wildly, China construction steel market headed down amid
fluctuation in June 2010 but the pace slowed.
The
growth of newly started projects and total investment in new projects in
the first five months of 2010 have both posted a yearly increase as the
nation continues stricter control on real estate sector. Therefore,
construction steel demand weakens to some extent on the whole. The
relationship between supply and demand is likely to improve in later
stage as more and more steel mills shut down production for maintenance
during June-July in view that construction steel price has been running
below average industrial cost for more than one months. Moreover, market
supply will remain abundant. It is predicted that China construction
steel market will fluctuate at the bottom level and some cities might
see a rally in July.
I
Review on June market
I.1
Construction steel production grew rapidly and oversupply
pressure mounted up
I.1.1
Daily output of wire rod hit a fresh record high
I.1.2
Construction steel exports surged up but the total volume was not high
I.1.3
Apparent consumption grew rapidly
I.2 The
growth of new projects and total investment in new projects posted a
yearly decrease despite of strong growth in real estate investment
I.3
Construction steel inventory fluctuated a little
I.4 The
growth of Central Bank’s money supply and new loans posted a monthly
decrease
II
Analysis on May Market
II.1 Steel mills intensified maintenance as construction steel
price haunts below average cost of the industry
II.2 The
growth of construction steel production will be restrained as 30 million
tonnes of iron-making capacity and 8.25 million tonnes of steelmaking
capacity should be washed out before the third quarter
II.3
Construction steel demand will not weaken sharply as China accelerates
construction of high speed railway and low-income housing
II.4
Construction steel price lacks momentum to rise due to continuous drop
in raw material prices
II.5
Central Bank turns to net capital injection and money supply tightness
will relieve slightly
II.6 Steel
mills’ ex-works prices are still higher than market price despite of
massive price cut
Table 1
Spot price of China wire rod/ rebar in June
Table 2
Ex-works prices of China’s leading steel mills in June
Graph 1
Q235 6.5mm wire rod price trend in June 2010
Graph 2
HRB335 20mm rebar price trend in June 2010
Graph 3
Monthly output and growth of construction steel in 2009-2010
Graph 4
Accumulative output and growth of construction steel in 2009-2010
Graph 5
Daily output of Construction steel in 2009-2010
Graph 6
Construction steel import in 2009-2010
Graph 7
Construction steel export in 2009-2010
Graph 8
Semis import and export in 2009-2010
Graph 9
Accumulative apparent consumption of construction steel in 2009-2010
Graph 10
Monthly apparent consumpti0n of construction steel in 2009-2010
Graph 11
China’s urban fixed asset investment in 2009-2010
Graph 12
Real estate investment in 2009-2010
Graph 13
China construction steel inventory in 2009-2010
Graph 14
China money supply growth in 20098-2010
Monthly Report on China HRC/CRC Market for June 2010
China
HRC/CRC market continued downwards trend in June. Till June 30, China’s
average price of 1.0mm CR plate, were CNY 5247 per tonne, down CNY 501
per tonne compared with the end May. Average price of 2.75mm and 5.75mm
HR coil were CNY 4286 per tonne and CNY 4121 per tonne, down CNY 228 per
tonne and CNY 243 per tonne.
The
major reason that drag down the market of June were: a) Chinese steel
production surged b) government removed steel export rebates, which
affected market sentiments c) market sentiments subdued.
Chinese
economy maintains stable and fast growth based on current figures,
however, growth in investment and industrial added value slow down, and
consumption in downstream sectors weakens.
Chinese
HR/CR coil production hit record high in June. Meanwhile, government
revoked HRC export rebates, which dampened Chinese competitiveness in
world export trade and increased domestic supply pressure. Market
sentiments subdued. Although Chinese spot market fell down, cost
pressure on steel mills may not be relieved as contract ore price would
further increase. China HRC/CRC market would reach the bottom in July.
I
China HRC/CRC market fell in June 2010
II
Outlook on July market
Il.1
Steel demands may weaken as growth in FAI and industrial added value
slow down
Il.2
Growth in money supply and new credit loans slipped
Il.3
China HRC/CRC production hit record high in May
Il.4
China HRC/CRC inventory maintain high
Il.5
Global steel market will continue slipping
Il.6
Steel mills will continue to lower steel price in July
Il.7
Export rebates removal will weaken Chinese products in world export
market
Il.8
Chinese steel mills see rising operating cost
Table 1
SteelHome China Steel Price Index (SH_CSPI) in June
Table 2
HR/CR Prices in China Major Markets in June
Table 3
China HRC/CRC Production in May
Table 4
CRC Output, Import/export and Supply in May 2010
Table 5
EXW Price of SPCC（St12）
1.0mm *1250*C
Table 6
EXW Price of Q235（SS400）
5.5mm *1500*C
Graph 1
Average price of China HRC/CRC in 2009-2010
Graph 2
Monthly output of HRC in 2009-2010
Graph 3
Accumulative HRC production in 2009-2010
Graph 4
China HRC monthly import/export in 2009-2010
Graph 5
China HRC available supply in 2009-2010
Graph 6
Accumulative supply of China HRC in 2009-2010
Graph 7
China CRC monthly import/export in 2009-2010
Graph 8
Accumulative CRC production in 2009-2010
Graph 9
China CRC import/export in 2009-2010
Graph
10 Apparent consumption of China CRC in 2009-2010
Graph
11 Accumulative apparent consumption of CRC in 2009-2010
Graph
12 China HRC/CRC daily production in 2009-2010
Graph
13 Daily supply of HRC/CRC in 2009-2010
Graph
14 China HRC Inventory in 2008-2010
Graph
15 China CRC Inventory in 2008-2010
Graph
16 SteelHome Global Steel Price Index (SH_GSPI) In 2008-2010
Graph
17 Global HRC price trend in 2008-2010
Graph
18 Global CRC price trend in 2008-2010
Monthly Report on China Iron Ore Market for June 2010
China
iron ore market price continued dropping throughout June. the Northern
Chinese market slightly undulated in early and middle June and
encountered a freefall in late June. Southern Chinese market lost CNY 90
-120 in its continuous drop through the whole month.
Internally, steel mills had production cutbacks on low prices. To
alleviate cost pressure, steel producers also lowered purchase volume
and procurement price for iron ore concentrates.
Externally, Fe 63.5 percent Indian iron ore fines first jumped USD 3-5
to USD 152-153 per tonne (CIF) due to rainy season and India’s increase
in railway transportation charges, but fall back to USD 145-147 per
tonne (CIF) in late June on China’s weakened demand.
Though
China steel makers are suffering loss, local miners are still at gains.
The whole mining operation was not affected however some dressing plant
stopped production. Iron ore concentrates procurement prices may
decrease further on steel mills’ cost management intention but the
downwards trend may slow down after two-months’ drop.
I Chinese
iron ore prices kept dropping throughout June
II
Analysis on China iron ore market in June 2010
II.1
Iron ore supplies likely to decrease in July
II.2
Price of imported iron ore dipped slightly
II.3
Ocean freight to run at low level in July
II.4
Iron ore inventory at ports shrank to some extent in June 2010
II.5
China steel price kept decreasing in June 2010
II.6
Q3 international iron ore price bound to rise
II.7
India proposing a windfall tax on iron ore exports
II.8
Domestic steel mills might lower concentrate procurement price further
Table 1
China
Iron Ore Price in Aug. 2009-June. 2010
Table 2
Steel
Price Changes at Domestic Market
Graph 1
China iron ore price in 2009-Jun.2010
Graph 2
China iron ore output in 2009-May 2010
Graph 3
Price contrast between domestic and imported ore
Graph 4
International ocean freight in 2009-2010
Graph 5
China iron ore import & inventory in 2009-2010
Monthly Report on China Scrap Market for June 2010
Chinese
scrap price stopped falling gradually in June on the back of spot
resources shortage and diminished imports. Steel price in China has been
lower than industry's average cost, increasing steel mills organized
facility overhauls and reduced scrap orders.
International scrap price drop sped up in June, currently even
approaching the level of China-produced scrap price. Therefore, part
steel mills and traders rejoined in the importing market. It is
predicted that Chinese scrap price will experience slight fluctuation in
July.
I Review on China scrap market in June 2010
l.1
Chinese scrap price stabilized gradually
l.2 Steel
mills' purchasing activity weakened and scrap transaction declined
l.3
Steelworks' scrap inventories & purchase price adjustment
l.4
International scrap prices drop nonstop
II Outlook on China scrap market in July 2010
ll.1 Scrap resources in China to remain tight
ll.2 Scrap imports to warm up
ll.3 Domestic scrap transaction to weaken
ll.4 International scrap market to wake up
ll.5 Pig iron price to volatilize at low level
Table 1
6 -10mm
Scrap purchase price adjustment in June
Graph 1 China 6-10mm scarp prevailing price in 2009-2010
Graph 2 Scarp price VS rebar in East China in 2009-2010
Graph 3
Scrap use & inventory of steelmakers in 2009-2010
Graph 4
Scrap average price Japan during 2009-2010
Graph 5 China scrap import & import price in 2009-2010
Graph 6 China scrap import price in 2009-2010
Graph 7 China iron/steel ratio curve in 2009-2010 |
