Date: Jan 28, 2019
China is stepping up inspections to enforce new rebar standards that smaller mills have been slow to adopt since they took effect in November, adding support for vanadium and rebar prices.
The China state bureau of quality and technical supervision (CSBTS) earlier this month conducted quality inspections on rebar producers in Jieyang in Guangdong province and this week visited mills in Xuzhou city in east China’s Jiangsu province.
The standards, which came into effect on 1 November 2018, eliminated rebar grade HRB335 and established a new HRB600 grade that is more able to withstand earthquakes with a higher content of vanadium alloys and lower tolerance level.
Steel market participants said enforcement has been lax and around 30-40pc of mills, mostly smaller ones, have not fully switched to the new standards. Jieyang blast furnace operators were confident they passed the inspection, but re-rolling mills that buy billet from the inspected mills to make rebar were not as confident, market participants said.
The new standards will eliminate outdated rebar production processes, squeezing smaller operators that cannot afford to implement them from the market. The alloys required to be added to the converter will increase costs by Yn100-300/t ($15-44/t). Mills will no longer be allowed to use water to cool rebar after rolling because it promotes rust.
The standards also require thinner rebar dimensions to engrave labelling to reduce counterfeit supplies and set stricter limits for tolerance, or variation of diameter, on some grades with the maximum tolerance for 6mm-12mm rebar reduced to 6pc from 7pc.
