SHANGHAI, Aug 15 (SMM) – Hot-rolled steel strip prices exceeded coil prices in the Chinese market on Tuesday August 14 as production cuts continued in Tangshan, Hebei province, SMM learned.
Strip prices stood 10 yuan/mt higher than coil prices in Shanghai on Tuesday. In comparison, strip prices stood 131 yuan/mt lower than coil prices as of July 24. Strip prices have been rising from the middle of July as the Tangshan government issued new production cuts on steel mills from July 20- August 31 as part of air quality improvement initiatives.
The cuts affected strip production more than coil production as Tangshan is home to most Chinese strip producers. Coil producers are mostly located in north China and are not limited to the Tangshan area.
SMM also learned that demand from tube/pipe producers has remained robust from the start of this year, and this also buoyed prices of strips.
As strip prices exceeded coil prices, some buyers began to procure coil to process the materials into strips. This is likely to provide some support to coil prices.
