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 are projected to soften over May 12-16, as domestic steelmakers’ production enthusiasm may sustain amid healthy profit margins, while a continuous recovery in downstream demand is unlikely, exerting some pressure on the long steel fundamentals.
Hot-rolled coil: This price is likely to decrease further in the week through May 16, mainly as end-users remain cautious about HRC procurement and only stock up some quantities to fulfill immediate needs. “The overall stock pressure remains manageable despite the accumulation last week due to the Labour Day holiday, while positive macroeconomic news has yet to provide meaningful support to prices,” according to a Shanghai-based source.
HRC inventories at traders’ warehouses in the 33 Chinese cities under Mysteel’s tracking ended a nine-week decline last week, rising by 4.3% or 115,500 tonnes on week to 2.8 million tonnes as of May 8.
Cold-rolled coil: This price is forecasted to drop in the week ending May 16, as output may persist high, while demand remains largely weak. Over May 1-7, CRC production among the 29 steel mills Mysteel follows across the country grew for the second week, up by 0.9% or 7,500 tonnes on week to reach 882,700 tonnes, hitting a record high since Mysteel launched the survey in May 2015.
Medium plate: This price is expected to be narrowly rangebound during May 12-16, due to the relatively low stocks of medium plate held by traders and limited new supply arrivals.
Stocks of medium plate at commercial warehouses in the 31 cities Mysteel monitors nationwide settled at 976,400 tonnes by May 8, up 1.8% on week but still lower by 36.5% on year.
Sections: The prices of steel sections may lose ground this week with the weakness in both production and demand. End-users generally hold a wait-and-see stance, while traders are inclined to offload steel sections stocks at hand quickly to avoid risks.
Note: This article has been written in accordance with a content exchange agreement between MySteel Global and BigMint.
Leave a Reply