The cost of key steelmaking ingredients including coking coal, metallurgical coke, and iron ore continued rising in December, while that of PCI coal dropped, according to data from the China Steel Development Research Institute.

Expenses on raw materials constituted over 70% of production costs for steel enterprises in China, said the agency, which directly decided their steel price competitiveness and profit margins.

In December, the weighted average purchase price of coking coal climbed 4.54% month on month to 2,009.00 yuan/t, on an air-dried basis. That for met. coke reached at 2,409.72 yuan/t, rising 6.14% from the preceding month.

The costs of domestic iron ore and imported iron ore fines also increased 4.23% and 11.24%, respectively, compared with the preceding month, reaching 951.35 yuan/t and 1,039.60 yuan/t

The costs of pulverized coal injection (PCI) coal, used to boost steel output, fell 1.33% to 1,231 yuan/t. Scrap steel prices edged up 1.96% to 2,607 yuan/t.

For the full year, coking coal, PCI coal, metallurgical coke and scrap steel costs declined between 14 and 22% compared to 2022, but domestic iron ore and imported fines rose 4.37% and 5.34% respectively.

(Writing by yan.sun  Editing by Alex Guo)
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