Steel and iron ore prices have surged thanks to the start of construction on the world's largest hydroelectric dam and steady profits from China's steel industry.
World steel prices
At the end of the trading session on July 21, the price of steel rebar for August delivery on the Shanghai Futures Exchange increased by 1.2% (38 yuan) to 3,121 yuan/ton. On the Dalian Exchange, the price of iron ore for August delivery increased by 1.5% (12.5 yuan) to 806.5 yuan/ton. Similarly, the price of iron ore for August delivery on the Singapore Exchange-SGX increased by 2.71 USD to 103.48 USD/ton.
Iron ore prices surged to their highest in nearly five months in early trading on Monday, after China announced the start of construction of the world's largest hydroelectric dam, creating a new impetus for demand for construction steel, while reflecting positive expectations about economic recovery prospects and stimulus policies, according to Reuters.
Chinese Premier Li Qiang has officially announced the start of construction on a hydroelectric dam project that is expected to surpass the Three Gorges Dam in scale. The project is part of China’s renewable energy development strategy and will require a large amount of construction steel, giving a strong boost to the domestic steel market.
“Iron ore and rebar futures are reacting very positively to the news of this mega-project,” said Atilla Widnell, managing director of Navigate Commodities in Singapore.
“There is no doubt that the construction of the dam will strongly boost the domestic steel market, and may even attract construction steel sources from all over the country, especially when the project is three to four times larger than the current Three Gorges Dam,” he added.
The Three Gorges Dam currently holds the record for being the world's largest hydropower plant, and China's move to implement a project of such magnitude demonstrates the country's strong commitment to infrastructure and energy transition.
In addition, China’s decision to keep its benchmark lending rate unchanged – as expected by the market – following better-than-expected second-quarter economic data also contributed to the bullish sentiment in the commodity market. According to Mysteel Global, rising expectations for economic stimulus measures have pushed up prices of key steel products.
Specifically, improved profits from steel sales have encouraged steel mills to boost production. The average blast furnace capacity utilization rate in the week of July 11-17 increased by 0.99 percentage points from the previous week, according to data from Mysteel.
However, amid a buoyant domestic market, trade tensions between China and Canada have shown signs of escalating again, especially regarding the steel industry.
The Chinese Embassy in Ottawa has criticized Canada’s new protectionist measures on imported steel, saying they violate World Trade Organization (WTO) rules and harm the global trade order. The response came after Canada announced measures to prioritize the use of domestic steel in federal projects and strengthen protection for the domestic steel industry.
On July 18, China's Ministry of Commerce called on Ottawa to stop its "wrong actions" in imposing restrictions on steel imports, and said it would take necessary measures to protect the legitimate rights and interests of Chinese enterprises.
Meanwhile, the Canadian Steel Manufacturers Association (CSPA) voiced support for the Government's moves, saying that increased protection is necessary to support the domestic steel industry.
Domestic construction steel prices
Updated from SteelOnline.vn, steel prices in the Northern, Central and Southern regions are stable, currently steel prices fluctuate from 12,520 - 13,580 VND/kg for products such as CB240 and D10 CB300.
In the North: Viet Duc Steel: CB240 rolled steel at 13,050 VND/kg; D10 CB300 ribbed steel bar at 12,440 VND/kg. Hoa Phat Steel: CB240 rolled steel at 13,230 VND/kg; D10 CB300 ribbed steel bar at 12,830 VND/kg. Viet Sing Steel: CB240 rolled steel at 13,130 VND/kg; D10 CB300 ribbed steel bar at 12,930 VND/kg.
Viet Y Steel: CB240 steel coil price 13,130 VND/kg; D10 CB300 ribbed steel bar price 12,520 VND/kg. VAS Steel: CB240 steel coil price 13,130 VND/kg; D10 CB300 ribbed steel bar price 12,730 VND/kg.
In the Central region: Viet Duc Steel: CB240 coil steel is priced at 13,550 VND/kg; D10 CB300 ribbed steel is priced at 13,500 VND/kg. Hoa Phat Steel: CB240 coil steel is priced at 13,230 VND/kg; D10 CB300 ribbed steel is priced at 12,830 VND/kg. VAS Steel: CB240 coil steel is priced at 13,230 VND/kg; D10 CB300 ribbed steel is priced at 13,730 VND/kg.
In the South: Hoa Phat Steel: CB240 coil steel is priced at VND13,230/kg; D10 CB300 ribbed steel is priced at VND12,830/kg. VAS Steel: CB240 coil steel is priced at VND13,130/kg; D10 CB300 ribbed steel is priced at VND12,730/kg. TungHo Steel: CB240 coil steel is priced at VND13,030/kg; D10 CB300 ribbed steel is priced at VND12,530/kg./.
Source: https://baolamdong.vn/gia-thep-hom-nay-22-7-bat-tang-cung-quang-sat-383167.html
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