Chinese finished steel exports totalled 5.6mt in May, up 780kt month-on-month, and continuing the recovery from the February low of 3.1mt. Chinese finished steel exports amounted to 21.6mt over the first five months of 2008, still 20% lower than they were over the corresponding period in 2007, yet evidently recovering from the export slump that began in July 2007. Meanwhile, Chinese finished steel imports were 1.3mt in May, and from January to May, total finished steel imports were 7.1mt, down by 3.3% Year-on-Year.
In May, China imported 38.9mt iron ore, the second highest monthly import figure on record, with the peak set in April at 42.8mt. For the first five months of 2008, China imported a total of 192.4mt of iron ore, up by 19.4% Year-on-Year.
The Chinese domestic coke price hit another record high over the past week, reported at $409/t ex-Vat, up by 17% Month-on-Month. Meanwhile, the coke export price also exceeded the $600/t benchmark; also a record high price.
China's Shandong province has increased the peak-rate power tariff for industrial users to 170% of the basis tariff, effective on 10 June. Aluminium output in Shandong province in 2007 was 1.55mt, about 12.4% of total Chinese production, although we estimate production capacity reached 2.4mtpa by the end of the year. We do not expect the hike in power tariffs to negatively affect aluminium output in the province because about 84% of production capacity in the area has captive coal-fired power stations. The main issue raised from the tariff increase is the potential for changes in power tariffs elsewhere in China, especially in the power-deficient South and East.
Source: Mineweb
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