The stocks of five major steel products among the traders in China’s 132 cites declined further and faster over April 10-16, down 5.7% on week as against the 4.2% drop in the prior week, thanks to the better demand from the downstream users, Mysteel Global noted.
The inventories of rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate at these traders declined in a row for the fifth successive week to 31.8 MnT as of April 16, according to Mysteel’s latest weekly stocks survey, among which, rebar and wire rod stocks accounted for 22.8 MnT or 71.5% of the total.
Over April 10-16, rebar stocks declined 6.1% on week to 16.4 MnT and wire rod reduced by 7.3% on week to 6.3 MnT, both being faster than the average weekly decline rate.
“Our sales this week improved further from last week, as demand from the downstream industries such as construction sites have been firming,” a steel trader from East China’s Zhejiang province told Mysteel Global.
North China, indeed, is witnessing the continuing firming in downstream demand than East China, Mysteel Global has learned from market sources. “Spring has come to North China, and the local market has been warming up with local construction project contractors seizing the opportunity to accelerate the pace of building,” a Shanghai-based steel trader noted.
As a result, the price difference between HRB 400 20mm dia rebar price in East China’s Shanghai and that in Beijing shrank to Yuan 20/MT ($2.8/MT) as of April 16 as against the Yuan 130/MT on March 16 with the pick-up in the Beijing rebar price, Mysteel’s statistics showed.
Despite recent declines in finished steel stocks in commercial warehouses, “the tonnage is still too high, and as long as this is the case, the chances and room for price recovery will be very limited,” the Zhejiang trader admitted.
“Our tactic nowadays is to buy low and sell high, but I will not stock up even just a minor volume until the prices show a signal of definite uptrend,” he added.
On April 13, the trading volume of rebar, wire rod and bar-in-coil among the 237 traders across the country hit its 6.5-month high of 288,953 MT/day, up 16.6% on day or 19% on week, Mysteel’s daily tracking showed, as steel products have been changed hands among traders.
Mysteel’s smaller-scale study on traders in just 35 cities showed that their five finished steel inventories were still 7.9 MnT or 59.4% higher on year, totalling 21.3 MnT as of April 16 despite having declined for five successive weeks, or down another 5.1% on week over April 10-16.
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