The Chinese steel engine that powered on for a good six months after the start of the Covid-19 pandemic is finally starting to lose steam, according to market sources.
Booming domestic demand and equally strong local steel prices had been the savior of steelmakers everywhere in the second and most of the third quarter of 2020, which either indirectly
improved sentiment in Asia or opened arbitrage windows for the rest of the steelmaking world to ship metallics, semi-finished steel and finished products to China.
But market sources say the Chinese steel market has reached a turning point in the first half of September, with bearish sentiment setting in, causing regional prices for steel and steelmaking raw materials to fall.
Benxi Iron & Steel, a major exporter in China, kept its export price for HRC stable at $535 per tonne fob from September 8 after continually raising it in the past few months. Shagang, another major exporter, lowered its export price for the same product by $5 per tonne to $535 per tonne fob from September 7.
Drying stimulus
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