The latest issue of China Metals Weekly for the week ending March 1st showed that long product prices continued to rise sharply. Rebar (20mm), advanced 3.0% week on week to reach $491 per net ton. On a month on month comparison rebar jumped 16.4% and on a year on year basis rebar jumped was up by $174 per ton or 54.8%. For reference 3mm hot rolled coil prices advanced at a far slower rate, up 1.4% month on month and down 2.3% week on week. On a year on year basis, coil prices rose 53.3% with prices settling at $516 for the week.
Figure 1 illustrates the pricing history of Chinese long products together with hot rolled coil pricing for comparison. The swift price escalation can be attributed to surging raw material costs (coking coal and metallurgical coal), and a strengthening local economy. Figure 2 shows that structural product pricing to include: Beams, angles and channels move in almost perfect lock-step with one-another. Beams (25#) were priced at $520 per ton while 100x100mm product sold at $605 and 400x400mm was sold at $586 per ton as of 3/01/2017.
At Gerdau we keep a keen-eye on Chinese steel production and pricing. China produces close to 50% of the world’s steel and as a result has a massive influence on global steel trade patterns. Imported steel volume and pricing has an influence on domestic steel so we routinely monitor it.