Steel yesterday settled up
by 0.71% at 46810 amid hopes that demand in China may gain traction at the end
of the second quarter. Fresh data showed that iron ore imports in the
world’s top consumer and producer rose by 4.5% year-on-year during May,
suggesting that a pickup in demand for steel drove producers to increase input
buying. The data added some respite following mixed PMI results and concerning
levels of real estate investment, which in turn spurred bets that the Chinese
government may roll out hefty sums of stimulus in the economy. The
underwhelming recovery since the country’s reopening from lockdowns drove
Beijing to consider capping crude steel output at 2.5% below the prior year’s
level in 2023.
China produced 92.64 million tonnes of crude steel in
April, down 1.5% from a year earlier, the statistics bureau said. The world's
largest steel producer manufactured 354.39 million tonnes of crude steel over
the first four months of this year, up 4.1% year-on-year, NBS data showed. Global
steel demand is expected to grow by 1.7% in 2024 following a 2.3% rebound
forecast for this year based on a recovery in manufacturing activity, an
executive from the World Steel Association (WSA) said. India's finished steel
purchases from China touched a five-year high in April, and the country's
overall imports of the alloy reached a four-year high, according to provisional
government data. India's crude steel production stood at 10.7 million tonnes in
April, up 3.2% from a year earlier. India's steel consumption is expected to
grow by 7.5% during the current fiscal year to March 2024, boosted by rising
demand from the domestic construction, railway and capital goods sectors.
Technically market is under short covering as the
market has witnessed a drop in open interest by -12.66% to settle at 1380 while
prices are up 330 rupees, now Steel is getting support at 46590 and below same
could see a test of 46370 levels, and resistance is now likely to be seen at
46920, a move above could see prices testing 47030.