Production of rebars among the 137 Chinese steelmakers under Mysteel’s weekly study increased for a second straight week over December 5-11, rising by another 0.9% on week to reach 3.66 million tonnes. Market sources said the rise was mainly due to some mills restarting their operations after completing maintenance earlier on.
The capacity utilization rate of the sampled mills averaged 80.3% over the period, up by 0.7 percentage point on week, according to the study.
Meanwhile, Chinese rebar demand from construction projects has remained rather firm recently, with sales among the 237 sampled steel traders Mysteel tracks nationwide, hovering around 150,000 tonnes/day during the period, mainly thanks to the warm weather in East and South China, survey respondents said.
For example, the temperature in Shanghai on December 11 was in the 6-15 degrees Celsius range, notably higher from last year’s 3-9 degrees Celsius on the same day. “East China is one of the country’s major long-steel trading hubs and the balmy weather there is allowing work on construction sites to continue longer – a bullish factor for longs demand,” said an industry insider in East China’s Jiangsu.
Sales of rebar, wire rod and bar-in-coil among the 237 sampled traders averaged 169,035 t/d during December 5-11, slightly up from the 168,876 t/d over the prior survey period, according to Mysteel’s daily transaction report. Sales in East China averaged 96,585 t/d, also nudging up from the 96,299 t/d over the prior period.
Consequently, Chinese domestic rebar spot prices didn’t experience any sharp declines over the week, due to the slow growth in rebar output as well as the resilient demand, Mysteel Global notes.
As of December 11, the national average benchmark price for HRB 400 20mm dia rebar had moved down by a mild Yuan 48/tonne ($6.8/t) from December 5 to Yuan 4,012/t including 13% VAT, according to Mysteel’s database.
This article has been published under article exchange agreement between Mysteel Global and SteelMint.
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