Steel yesterday settled flat by 0.1%
at 48290 as China's demand remained a concern. The government is attempting to
reorient the economy away from heavy industries, and debt troubles are
affecting the property sector, so a resurgence in genuine demand for
construction and infrastructure inputs in China has yet to materialize. The
Chinese government is considering decreasing national steel output by 2.5% this
year, the third consecutive drop. Meanwhile, the country's state planner has
promised to enhance iron ore demand while cracking down on speculative pricing.
India's steel exports slumped to a
five-year low in the financial year that ended in March, as slowing global
demand and an export tax hampered shipments, government data showed. India, the
world's second-biggest producer of crude steel, shipped 6.7 million tonnes of
finished steel in 2022/23, a decline of 50.2% on the year and the lowest since
2018/19, the data showed. Major steelmakers had reported a drop in profits in
the December quarter, in part because the government had in May last year
imposed the export tax, which was withdrawn in November.
China's crude steel output rose 6.9%
on the year in March, official data said on Tuesday, as steel mills boosted
their output amid improved margins and expected robust downstream demand in the
peak construction activity season. Profitability among the surveyed 247 Chinese
steelmakers rose to 58.87% in late March, up from 38.96% by the end of
February. The world's top steel producer churned out 95.73 million tonnes of
the metal last month, up from 88.3 million tonnes over the same period in 2022,
data from the National Bureau of Statistics (NBS) showed. Production in March
last year was capped by stringent COVID-19 control measures and environmental
controls.
Technically market is under short
covering as the market has witnessed a drop in open interest by -4.12% to
settle at 1630 while prices are up 50 rupees, now Steel is getting support at
48170 and below same could see a test of 48050 levels, and resistance is now
likely to be seen at 48450, a move above could see prices testing 48610.