China steel rolling mills operating rates hiked as of early May 

SHANGHAI, May 13 (SMM) – Chinese steel rolling mills continued to step up operations as of early May, as they saw decent profits and bet on further increase in prices of steel finished products with rising demand lifting shipments at steel mills. 

An SMM survey showed that the operating rates across steel rolling mills in China increased 10 percentage points from a month ago to 84% as of May 12. 

More than 70% of the steel rolling mills reported profits, with those holding stockpiles of imported steel billet having greater profits as the prices of imported steel billet stood 30-100 yuan/mt lower than that of the domestic materials. 

A steel rolling mill in north China told SMM that the current purchasing prices of steel billet are relatively high at 3,220 yuan/mt, with the ex-work prices of finished steel products at 3,470-3,480 yuan/mt. 

According to a steel mill in east China, the cost of imported steel billet stood at 3,160-3,170 yuan/mt and that of domestic billet at 3,200 yuan/mt. The producer also showed some worries about the negative impact of the upcoming rainy season on the demand. 

Another steelmaker in east China reported marginal profits and took an optimistic prospects for spot steel prices in August-September. It ordered about 200,000 mt of imported steel billet with some 100,000 mt undelivered. 

In south China, the steel billet costs about 3,400 yuan/mt with finished steel product prices at 3,700 yuan/mt, said a local steel mill. It expects prices to trade rangebound in May-June, while takes a bullish view for prices in the third quarter.