FOCUS: Healthy margins override costs of new China rebar standards

The production cost of rebar will increase from November 1 with the implementation of China’s revised rebar standard GB-T 1499.2-2018, but spot prices are not expected to rise accordingly.

Production cost rises The revised standards prohibits steel mills from using a water-quenching process in rebar production to meet the new yield and strength requirements. "This kind of rebar rusts easily and is not suitable for welding. It also affects building safety," an industry analyst in Shanghai said. In order to produce rebar that meets the new standards, steel mills need to raise the content of alloys such as vanadium. “The [required] amount of vanadium to be added is 0.03-0.05% for HRB400 and 0.05-0.08% for HRB500,” an official at the China Iron & Steel Research Institute (CISRI) said in August last year. “Production costs will increase by about 200 yuan ($28.80) per tonne compared with the past,” a source at a mill in north China said. One industry analyst working...

Published

Jessica Zong

October 25, 2018

10:10 GMT

Shanghai