Stocks of the five major finished steel products held by the 184 Chinese steel mills monitored regularly by Mysteel continued to move up for the second week over December 31-January 6 as consumption among end-users remained depressed – weakened by the sudden winter freeze – while the domestic mills still maintained high output during the period.
As of January 6, total inventories of the five major steel products comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate at the surveyed mills’ yards increased by another 3.2% on week to 5.4 million tonnes, according to Mysteel’s latest weekly survey.
“Daytime temperatures in northern China have fallen well below zero degrees C and the extremely cold weather has forced many construction firms to end their outdoor work ahead of schedule,” a market source in Shanghai said. “Their demand for steel remained sluggish this week.”
At the same time, the resurgence of the COVID-19 pandemic in Shijiazhuang and Xingtai in North China’s Hebei province, major steel-producing hubs in China, had disrupted finished-product transportation and local steel demand, while the impact on the mills’ production was not obvious, as Mysteel Global reported.
Over December 31-January 6, China’s total output of the five major steel products among the surveyed steel producers grew for the second week to 10.52 million tonnes, up another 0.6% from the prior week, according to the survey.
Finished steel stocks of the five major items at traders’ warehouses in the 132 Chinese cities Mysteel checks also moved up further to top 14 million tonnes as of January 7, the survey showed. The on-week growth also expanded to 6.4% against the prior week’s 2.6%, indicating the lacklustre demand from steel end-users.
Although traders’ steel stocks were not very high and the volumes in Mysteel’s former smaller sample across just 35 cities were 0.5% lower compared with the same period last year, most Chinese traders were reluctant to build up stocks for the time being, as steel prices persisted rather high, Mysteel Global noted.
As of January 6, China’s national price of HRB 400 20mm dia rebar, a bellwether of domestic steel-market sentiment, was assessed at Yuan 4,422/tonne ($685/t) including the 13% VAT, higher by Yuan 63/t on week and surging by Yuan 584/t from one year ago, according to Mysteel’s data.
Source : https://www.mysteel.net/article