Chinese steel producer Jiangsu Shagang has raised its rebar ex-works prices by 30 yuan/t ($4.20/t) for mid-October deliveries in response to solid rebar demand during the high season.
Shagang's base rebar specification HRB400 with 16-25mm diameter will be offered at Yn3,900 /t for mid-October deliveries, effective from today. Demand for rebar remains firm for construction steel in the current high season that runs to early November. Shagang has increased its rebar ex-works prices twice this month for a total increase of Yn80/t.
Even with firm spot sales volumes this week, trading firms are reducing offer prices in main east China cities to reduce inventories that built up during China's 1-7 October national day holiday. Shanghai rebar prices have fallen by Yn40/t to Yn3,740/t ex-warehouse since 30 September.
Shagang usually sells to agents and trading firms that resell to consumers from warehouses. Since spot ex-warehouse prices remain at a discount to the steel mill's prices, Shagang will keep in place its rebates to agents on prior sales to compensate for falling spot prices.
Mills in north China are resuming rebar production after the holiday. China's weekly rebar input increased by around 300,000t to more than 3.4mn t this week, third-party data showed.
Higher rebar output leaded to firmer demand for scrap as well. Shagang raised its heavy melt scrap No.3 purchasing price by Yn100/t to Yn2,790/t on 9 October. Higher raw material costs are also supporting Shagang's steel prices.
Shagang also increased its prices for wire rod and small-sized rebar in coil by Yn60/t.
Shagang listed prices effective 11 October:
- HRB400 6mm rebar at Yn4,500/t
- HRB400 8-10mm rebar at Yn4,200/t
- HRB400 16-25mm rebar at Yn3,900/t
- HRB400 10mm rebar at Yn4,060/t
- HRB400 12mm rebar at Yn4,000/t
- HRB400 14mm rebar at Yn3,930/t
- HRB400 28-32mm rebar at Yn3,960/t
- HRB400 36mm and 40mm rebar at Yn4,150/t
- HRB500 rebar sizes are Yn350/t higher than HRB400
- HRB500E rebar sizes are Yn380/t higher than HRB400
- HPB300 6.5mm wire rod at Yn4,160/t
