Stocks of the five major finished steel products held by the 184 Chinese steel mills monitored regularly by Mysteel mounted for the third consecutive week over January 7-13, as domestic steelmakers continued to produce normally while steel consumption among end-users shrank further.
Total inventories of the five comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate at the surveyed mills’ yards reached 5.8 million tonnes as of January 13, with the on-week rise reaching 6.3% compared with growth of 3.2% recorded over the prior week, the survey showed.
Steel consumption weakened further this week due to the impact of the rise in COVID-19 cases in North China’s Hebei province. Work on construction sites in Hebei’s Shijiazhuang, Xingtai and Langfang cities was stopped because of the pandemic, and citizens were requested to stay at home to curb the spread of the virus, as Mysteel Global reported.
In parallel, steel demand in other regions in northern China shrank too as many outdoor projects ended earlier than scheduled because of the cold weather there, Mysteel Global noted.
Mysteel’s survey among 237 trading houses across China showed that daily trading volume of construction steel including rebar, wire rod and bar-in-coil decreased to 148,138 tonnes/day on average over January 7-13, plunging by 36,506 t/d or 19.8% from one week earlier, according to Mysteel’s data.
Chinese mills’ steel output has remained stable, however, as steelmakers so far have been little impacted by the resurgence of COVID-19 and finished steel prices remain attractive to them. Over January 7-13, total output of the five major items among the surveyed steel producers reached 10.5 million tonnes, almost unchanged from the level one week before, according to the survey.
Domestic steel prices have been persisting at relatively high levels despite the slight retreat this week. As of January 13, the national price of HRB 400 20mm dia rebar, a bellwether of domestic steel-market sentiment, was at Yuan 4,372/tonne ($676/t) including the 13% VAT, lower by Yuan 50/t on week but higher by Yuan 537/t on year, according to Mysteel’s data.
Finished steel stocks of the five major items at traders’ warehouses in the 132 Chinese cities Mysteel checks also climbed for the third week over January 8-14, with the slowdown in demand lifting inventories higher by another 5.2% on week to 14.7 million tonnes, the survey showed.
Written by Nancy Zheng, zhengmm@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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