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China’s largest steel centre, Tangshan, has ordered emergency traffic controls and mass testing of the coronavirus with a rapid increase in the daily count.
According to a report, on 19 March 22, the office of the government wing responsible for preventing and controlling the new Covid outbreak issued a warning to several cities, including Tangshan, to strengthen control measures against the spread of the coronavirus.
The steel production of large steel mills will not be affected in the short term, as they have sufficient stocks of raw materials. However, smaller steel mills are currently being closed due to higher energy prices (oil and gas) and weaker demand for billets. Although ex-works prices of steel billets have fallen, transactional prices of steel billets are still relatively high.
In the meantime, some steel traders have temporarily withdrawn due to the increase in infections, but pricing and sales of most market resources are still ongoing.
The recent release of legislation has had an impact on warehousing and logistics operations in Tangshan. Heavy vehicles are not allowed to enter the factory for loading as well as the entry of lighter vehicles.
This state of emergency in Tangshan is affecting the production of steel strips and profiles and the transport of resources has been greatly impacted. Thus, the main surrounding markets of Tianjin and Shengfang, and other areas, Cangzhou, Baoding, Shijiazhuang and Handan, have been affected.
Operations at the ports slowed down, and overall volumes of resource transportation, whether from the factory, the port of collection, or anywhere in between, also showed a slight decline.
Tangshan, with an annual output of 160 million tonnes, accounts for 56% of Hebei province’s total steel production and 13% of the country’s total steel output.
