- Longs prices to soften; traders keen to offload inventories
- HRC may fluctuate; market to monitor “Two Sessions” impact
Mysteel: 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 these two long steel products are likely to soften over 10-14 March. Many traders are looking to offload their inventories of these steel longs to avoid risks amid the slower-than-expected recovery in end-user demand and a lack of market confidence.
Hot-rolled coil: Prices are expected to stay volatile in the week through 14 March. Market players are cautious about the near-term outlook, waiting to assess the actual impact of macroeconomic policies unveiled during the “Two Sessions” meetings.
“The overall market fundamentals stay resilient,” an East China-based source commented, however. Hot-rolled coil (HRC) stocks held among traders in 33 cities Mysteel tracks nationwide declined by 30,700 tonnes (t) or 0.9% w-o-w to 3.4 million tonnes (mnt) as of 6 March.
Cold-rolled coil: Prices will fluctuate narrowly in the week ending 14 March, as demand remains largely stable, with little chance of a significant increase in the short term. Meanwhile, traders are keeping their cold-rolled coil (CRC) inventories in hand at reasonable levels.
CRC output among the 29 steelmakers that Mysteel checks across China may hover at around 840,000-850,000 t this week.
Medium plate: Prices may move in a narrow band during 10-14 March. A source in South China’s Guangdong said many traders have grumbled about poor spot trading of steel plates due to the limited improvement in downstream demand. Additionally, local stocks of medium plates have increased further with the arrival of supplies from northern China, he added.
Sections: Sections’ prices are estimated to have some space to rise this week. On the one hand, the production suspension on re-rollers and integrated mills in North China’s Tangshan in response to heavy air pollution has eased pressure from the production side and helped bring down the high inventories.
On the other hand, end-users are mainly procuring steel sections to fulfil their immediate needs, as infrastructure projects are seeing slow starts due to tight cash flow. Meanwhile, traders are not keen to replenish their stocks of sections amid volatile prices.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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