Mysteel Global: Below is the brief near-term outlook for five key steel products Mysteel shares on a weekly basis, drawing upon the results of related surveys and communication with Chinese market participants.
Rebar & wire rod: Prices of the two long steel products over March 31-April 3 are likely to be underpinned by pre-holiday replenishing activity among end-users to fulfill their needs during the country’s Qingming Festival holiday over 4-6 April . Meanwhile, production of these longs may see a limited increase, so the pace of decline in long steel stockpiles may quicken.
Hot-rolled coil: This price is expected to remain rangebound in the week through 3 April. A source in South China’s Guangdong predicts that the output of hot-rolled coils will keep edging up, while the destocking of HRC inventories may slow down as demand has shown no signs of marked improvement.
HRC output among the 37 Chinese steelmakers that Mysteel surveys rose for the third successive week over 20-26 March, up 0.1% or 4,200 tonnes on week to touch a one-month high of 3.25 million tonnes.
Cold-rolled coil: This price is estimated to be largely stable in the week ending 3 April, mainly due to the steady production and demand. Meanwhile, CRC inventories hover at a low level compared to previous years, and market sentiment appears cautious.
As of 27 March, CRC stocks held by traders in 26 cities Mysteel monitors across China declined for the fourth week in a row, down 0.7% or 8,800 tonnes on week to a nearly two-month low of 1.21 million tonnes.
Medium plate: This price may be narrowly volatile over 31 March-3 April. A source in northern China observed tight supplies of medium plates in the local market, encouraging steelmakers and traders to hold onto their offering prices. On the other hand, demand from end-users continues to recover.
Sections: The prices of steel sections may weaken modestly this week, mainly due to the imbalance between production and demand, coupled with the skittish market mood. In the short term, consumption from building contractors is unlikely to improve substantially, as they primarily procure sections to meet immediate needs.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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