STEEL NEWS

Stainless steel in China hits record due to demand and shortage of raw materials

Chinese stainless steel futures rose more than 5% to a record high on Friday, July 16, amid strong declines in raw material consumption and supply, while concerns over a cut in steel production also supported prices, Reuters reported.

The best-selling stainless steel on the Shanghai Futures Exchange for August delivery jumped 5.1% to 18,895 yuan ($ 2,922.21) a tonne, the highest level since the contract was launched.

“Consumption in refining (for stainless steel) is relatively good and supply and demand have been strong,” Huatai Futures wrote in the note, adding that recent concerns about steel production cuts have also impacted supply prospects.

Meanwhile, environmental control measures in China aimed at curbing high energy and high emissions projects have led to a shortage of ferroalloys such as ferrochrome, an ingredient in stainless steel.

Stainless steel futures gained 8.9% over the week.

Other steel commodities on the Shanghai Exchange were down slightly, including steel rebar for October delivery down 0.2% to RMB 5,534 / t, while hot rolled coils fell 0.1% to RMB 5,953 / t.

Weekly apparent consumption of the five major steel products rose 3.9% to 10.77 million tonnes as of July 15, compared with a week earlier, according to consulting firm Mysteel, as steel inventories fell for the first time in six weeks.

Prices for other raw materials on the Dalian Commodity Exchange increased.

Iron ore futures for September delivery rose 2.9% to RMB 1,253 a tonne.

Coking coal futures rose 2.9% to RMB 2,045 a tonne, while coke futures rose 1.9% to RMB 2,660 a tonne.

Spot prices for iron ore with Fe62% for shipments to China rose $ 1 to $ 221.5 a tonne on Thursday, according to consulting firm SteelHome.