China: Billet prices decline but strong exports and low inventories limit downside

Chinese billet prices declined by RMB 10/t ($2) d-o-d to RMB 2,940/t ($440), while rebar prices edged up by RMB 1/t to RMB 3,074/t ($460). Potential capacity cuts and low inventories provided some support to domestic steel prices, despite sluggish end-user demand.

However, sluggish end-user demand continued to limit price gains, with the traditional “Golden October” peak season already halfway through without significant improvement in consumption. Meanwhile, steel export demand remained relatively strong at around 10 mnt per month, supporting market sentiment, although increasing logistics constraints posed challenges. Some coated steel mills extended delivery lead times to mid-November, while the HRC price spread widened. In the raw material market, portside coke inventories saw active purchases, indicating relatively firm demand, whereas coal prices faced increasing pressure.

Overall, Chinese steel prices fluctuated within RMB 10-20/t ($2-4) during week 42, reflecting weak domestic consumption, mixed raw material trends and supply-side support, while relatively strong exports helped limit further downside.