Stocks of the five major finished steel products at the 184 Chinese steel mills under Mysteel’s weekly survey continued to empty over July 8-14, falling for the second week to 6.3 million tonnes. Behind the dip in mill stocks was the deliveries of some stocks mills had made to traders’ warehouses during the survey period.
Inventories of the five major steel products comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate at the surveyed mills totalled 243,100 tonnes or 3.7% lower on week. Stocks of most steel products decreased by varying degrees on week except for the slight on–week rise of medium plate, the survey showed.
Finished steel production among the surveyed 184 mills reversed up over July 8-14 after sliding for three weeks, as some Chinese steel mills ramped up production to benefit from the growth in domestic steel prices and better margins, Mysteel Global noted.
As of July 15, the gross profits that the BF mills earned on rebar sales had recovered to Yuan 220/tonne ($34/t) against last week’s Yuan 28/t, Mysteel estimated, based on current steel and raw materials prices.
The domestic steel market is still in the off-season for steel consumption and actual demand from end-users remained lacklustre with the high temperatures or heavy rainfalls harassing most of China. Speculative demand improved over the past week after spot and futures prices showed some strength.
For example, the national price of HRB400E 20mm dia rebar, was assessed by Mysteel at Yuan 5,267/t including the 13% VAT as of July 15, up Yuan 177/t on week and hitting the highest since May 24. On the same day, the price of the most-traded rebar contract on the Shanghai Futures Exchange for October delivery closed the daytime trading session at Yuan 5,546/t, higher by Yuan 136/t compared with the settlement price on July 8.
Stocks of the five major steel items at the commercial warehouses Mysteel checks in 132 cities nationwide moved up further over July 9-15, up another 1% on week to 23.3 million tonnes, the survey showed.
Written by Nancy Zheng, zhangwd@mysteel.com
Table 1 Five major steel products stocks at mills (Jul 8-14)
Table 2 Five major steel products stocks at traders (Jul 9-15)
Note: Mysteel has started publishing the new set of data regarding traders’ steel inventories since March 19 2020 to better represent the market with bigger sample sizes.
Rebar and wire rod: Sample size is increased to 429 warehouses in 132 Chinese cities from the previous 215 warehouses in 35 cities.
Hot-rolled coil (HRC): Sample size is increased to 194 warehouses in 55 cities from the previous 138 warehouses in 33 cities.
Cold-rolled coil (CRC): Sample size is increased to 182 warehouses in 29 cities from the previous 134 warehouses in 26 cities.
Medium plate: Sample size is increased to 217 warehouses in 65 cities from the previous 132 warehouses in 31 cities.
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
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