Finished steel inventories at retail warehouses across China declined for an eleventh straight week during December 18-24 though the pace of the decline continued slowing as market sentiment was cautious amid the drastic fluctuations in steel prices, Mysteel Global noted.
According to the latest survey, stocks of rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate among traders in the 132 cities Mysteel tracks, moved down by another 275,900 tonnes or 2.1% on week during the period, as against the 613,200 tonnes or 4.5% on-week fall in the prior period, to total 12.8 million tonnes as of December 24.
“Currently, steel prices are much higher than in the same period last year, given the high raw materials prices. Thus, traders don’t dare replenish stocks when prices are staying high and fluctuating wildly,” an East China steel trader told Mysteel Global, pointing out that the levels was still low compared to March (when the pandemic was decimating business activity nationwide). The level was only 7% higher on year.
The national price of HRB400 20mm dia rebar had touched a 25-month high of Yuan 4,579/tonne ($701/t) on December 22 but immediately after, the price declined to Yuan 4,484/t as of December 23 (though it was still Yuan 341/t higher on week), Mysteel’s data showed. All prices include the 13% VAT.
The slowing pace in the decline of stocks was due to the softening of sales too, with the trading volume of rebar, wire rod and bar-in-coil among the 237 traders under Mysteel’s survey decreasing by 5.4% on week to 205,560 tonnes/day on average over December 17-23.
Among the five major steel items, stocks of rebar still dropped the most, falling by 161,800 tonnes or 2.9% on week and accounting for 58.6% of the overall decline in total steel stocks, according to the survey. The retail stocks of rebar nationwide topped 5.4 million tonnes, as of December 24.
In the meantime, steel inventories held by traders in Mysteel’s former smaller sample across just 35 cities have dropped for eleven straight weeks too, losing another 174,400 tonnes or 2.1% on week to 8.3 million tonnes as of December 24, as against the 4.3% decrease as of December 17. The volume was only 7.2% higher on year.
Written by Anna Wu, wub@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
Photo: World Steel Association
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