Stocks of the five major finished steel products held by the 184 steelmakers across China which Mysteel monitors accumulated at a faster pace of 3.4% on week over June 11-17 to reach 5.92 mn t. Over the period, steel production remained high while demand from steel users stayed low as wet season rains continued, Mysteel Global notes.
Total production of the five major items comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate grew for a seventh week over June 11-17 to 10.94 mn t, up another 0.2% on week and refreshing the new high since Mysteel started the survey in May 2015.
Despite the inclement weather affecting many regions, the keen enthusiasm that domestic steel producers have for producing has not been dampened so far because their profit margins are still reasonable. However, the rainy days have further weakened demand from steel users, especially those in East China, a market source in Shanghai said.
Mysteel’s daily survey among the 237 sampled trading houses across China showed that spot sales of construction steel comprising rebar, wire rod and bar-in-coil averaged 204,749 t/day over June 12-18, lower by 5,195 t/d or 2.5% on week. Within the total, trading volume from East China posted the sharpest week-on-week decline of 4% over the period, due to the frequent rainfalls this week, according to Mysteel’s data.
Over June 12-18, China’s total stocks of the five major steel products held by traders Mysteel canvasses regularly in the country’s 132 major cities emptied at a slower pace of 1.5% on week to 21.5 mn t, the survey showed. The decline was 1.4 percentage points lower compared with the prior week, indicating the dip in consumption among end-users,
China’s steel prices have weakened continuously under the pressure of high production and thin demand, as many Chinese steel mills and traders are ready to concede some margins and lower their offering prices to facilitate sales, Mysteel Global notes.
As of June 18, China’s national price of HRB 400 20mm dia rebar, a bellwether of domestic steel market sentiment, was assessed at Yuan 3,793/t ($535/t) including the 13% VAT, down Yuan 34/t on week, or lower by Yuan 176/t from one year ago, according to Mysteel’s database.
Table 1 Five major steel products inventories at mills (Jun 11-17)
| Product | Volume (‘000 tonnes) | WoW (%) | MoM (%) | YoY (%) |
| Rebar | 3,006.4 | 5.8% | -0.1% | 31.1% |
| Wire rod | 703.2 | 4.5% | 0.5% | 12.7% |
| HR sheet | 1,002.7 | -0.1% | -12.6% | 13.5% |
| CR sheet | 346.8 | 0.8% | -6.4% | 16.1% |
| Medium plate | 858.2 | -0.3% | -3.4% | 18.9% |
| Total | 5,917.3 | 3.4% | -3.2% | 22.8% |
Table 2 Five major steel products inventories at traders (Jun 12-18)
| Product | Volume (million tonnes) | WoW (%) | MoM (%) | YoY (%) |
| Rebar | 11.03 | 0.0% | -9.9% | – |
| Wire rod | 3.62 | -3.5% | -19.4% | – |
| HR sheet | 3.35 | -4.1% | -16.8% | – |
| CR sheet | 1.85 | -2.8% | -7.6% | – |
| Medium plate | 1.70 | 0.3% | 0.6% | – |
| Total | 21.55 | -1.5% | -11.9% | – |
Note: Mysteel has started publishing the new set of data regarding traders’ steel inventories starting March 19 to better reflect the market situation with bigger sample sizes, as explained in the previous data update. Month-on-month and year-on-year comparisons will be filled up on later dates when they are available.
Rebar and wire rod: Sample size is now increased to 429 warehouses in 132 Chinese cities from the previous 215 warehouses in 35 cities.
Hot-rolled coil (HRC): Sample size is increased to 194 warehouses in 55 cities from the previous 138 warehouses in 33 cities.
Cold-rolled coil (CRC): Sample size is increased to 182 warehouses in 29 cities from the previous 134 warehouses in 26 cities.
Medium plate: Sample size is increased to 217 warehouses in 65 cities from the previous 132 warehouses in 31 cities.
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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