Soon after Baosteel and Wugang lifted their January list prices, other major Chinese steel mills including Angang, Shougang, Taigang and Shagang all followed suit.
Last week, as supported by Baosteel and Wugang's prices increase, China domestic steel market moved up slightly in general, with the average prices increase of CNY 100 per tonne. The higher market prices then encouraged other mills to increase their list prices. According to Mysteel survey, there were 22 mills and 34 mills adjusted their prices for rebar and wire rod respectively last week.
Actually, steel mills in Europe and the US all have hiked their January list prices recently. However, Mysteel understands it is still too early to say that market has turned to better fundamentally, very likely, flat market in near term will see fluctuations with downward pressures.
On the other hand, steel making raw materials have seen another round of increase. The reference price of coke in Shanxi in December is now CNY 1750 per tonne up by CNY 50 per tonne from October. The same price increase is seen in scrap. Meanwhile, China railway also announced to increase its freight by 7.28% recently.
Analysis said the rising steel prices right prior to the annual iron ore benchmark prices talk would lighten China's leverage. It is said the rising steel prices have pushed up the spot prices of Indian iron ore greatly, which would eventually in favor of iron ore giants. The Indian iron ore miners raised their offers for 63.5% Fe content iron ore to USD 115 per tonne CFR China while in major China ports, the spot price for the same grade ore is CNY 820 per tonne.