- Chinese steel mills are not likely to remain profitable in August due to surging iron ore prices, Mysteel.com said. Analysts say rising domestic steel output and low levels of iron ore inventory at steel mills will drive up iron ore prices in the short term.
- 88 leading private steelmakers in China posted a combined profit of 1.24 billion yuan in 1H 2013, with profit per ton plunging to just 8.7 yuan from 33 yuan a year earlier, Hexun reported, citing an industry meeting. 42 of the 88 mills posted a combined loss of 6.32 billion yuan in 1H 2013. The conditions of private steelmakers were better than state-owned ones thanks to operating flexibility and resilience.
- Daily crude steel output of China's major steelmakers added up to 1.67 million tons in the final 10 days of July, down 2.2% from the previous 10-day period, according to the China Iron and Steel Association. Total inventories at these steelmakers amounted to 12.4 million tons as of July 31, down 749,000 tons from a month earlier.
- China's steel spot prices continued increasing in the week through August 11, with the average up 0.93%, according to Mysteel.com. Experts argue the price rises were driven by a reduction in supply. China's daily crude steel output declined 2% in July from June.
- After falling for 6 months China's coke prices began bouncing back in a number of regions due to a recovery in the steel market, the National Business Daily reported. Analysts expected coke prices to keep rising as the high season in September and October draws near.
- The spot price for 5,800kcal coal remained flat at 615 yuan/ton in the week through August 11 in Qinhuangdao, BNP Paribas says in its China Coal & Power Weekly report. The spot price for 5,500kcal coal fell by another 5 yuan to 560 yuan/ton, and the Bohai Bay coal index dropped by 5 yuan to 565 yuan/ton in the week. However, coal price at the mine mouth of Shanxi Datong rose by 20 yuan to 480 yuan/ton, the first week on week increase since December 2012.
- The prices of 5,500 kcal thermal coal averaged 570 yuan/ton in the Bohai Rim region on July 31, a decrease of 8 yuan/ton from a week ago and a decrease of 63 yuan/ton from the beginning of 2013, according to Osc.org.cn data. Coal prices have fallen for 10 consecutive months despite rising power generation in one of the hottest summers on record.
Oil & Gas
China may allow more private refineries to import crude oil and may increase its annual import quota by at least 10 million tons this year, the People's Daily reported. Currently the majority of oil import quotas are given to state-owned refineries while very few private firms are allowed to import crude oil. China's annual oil demand is estimated to exceed 700 million tons by 2020, where 2/3 of them will have to be imported.
National cement prices rose 0.9% week on week in the week through August 11, the fastest weekly increase in the year-to-date thanks to higher prices in Heilongjiang, Anhui and Jiangxi and Guangdong province, Daiwa said in research report. Cement prices fell in Henan. Inventory levels were down significantly in eastern China, mainly due to reduced supplies following power rationing. Cement demand in eastern China is starting to pick up.
The Shanghai Futures Exchange said it is working on allowing after-hours trading for some nonferrous metal futures to provide more investment options and better services. Currently after-hours trading is only available to gold and silver futures at the exchange.
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