There were offers for Japanese heavy scrap (HRS101 quality) at around $500 per tonne cfr China, however, buyers did not submit any bids.
“We plan to wait for more news on the development of Tangshan’s ministerial inspections,” an import trader in eastern China said.
China's Ministry of Ecology and Environment conducted surprise checks on steelmakers in Tangshan, and found four steelmakers running at high operating rates despite being placed under production restrictions.
They had also falsified steel production records and informed each other about the surprise checks.
A transaction was heard concluded at $485 per tonne cfr on Thursday, although sources could not confirm. Other transactions were heard concluded at $490-495 per tonne on Tuesday and Wednesday, sources said.
“If based on deals made in the past few days, mills may bid at $485-495 per tonne cfr,” a source at a northern China mill said.
Fastmarkets’ assessment for steel scrap, heavy recycled steel materials, cfr China was at $485-495 per tonne on Friday March 12, widening down by $5 per tonne from $490-495 per tonne on Thursday.
The rebounding steel prices also created optimism among some market participants, sources said.
For instance, Fastmarkets’ assessment for steel reinforcing bar (rebar) domestic, ex-whs Eastern China was at 4,700-4,730 yuan ($722-727) per tonne on Friday, up by 90-100 yuan per tonne week on week.
“The environmental restrictions will increase demand for low-emission steel making raw materials, including steel scrap, so prices will be on an uptrend,” an industry analyst said.
Some other market sources, however, think the production cut in Tangshan will lead demand for steel scrap to fall and weigh on prices.
“No one knows when steel mills can resume production, so some scrap sellers will not bet on future price increases but sell their product to mills in other regions,” a source at a second northern mill said.
The mill cut its steel scrap purchase price by 30 yuan per tonne on Friday to 3,313 yuan per tonne, excluding value-added tax for HRS101 scrap.
Eastern China steel mills, which are not influenced by environmental inspections, have largely maintained their purchase prices for steel scrap.
Fastmarkets’ assessment for steel scrap heavy scrap domestic, delivered mill China was at 3,340-3,390 yuan per tonne on Friday, widening downward by 10 yuan per tonne week on week.
Chinese steel scrap buyers have been absent from the import market due to the muted sentiment after some serious environmental inspections at steel mills in Tangshan yesterday, sources said on March 12.