The inventories of hot-rolled coil (HRC) across China assessed by Mysteel reached a three-month high last week, mainly driven by the sluggish demand from end-users.
The inventories of HRC held by traders in the 33 cities across China assessed by Mysteel surged by 97,700 tonnes on week to 2.79 million tonnes as of June 24, according to Mysteel’s stocks survey, while the total of stocks held by the steelmakers Mysteel tracks also soared by 24,200 tonnes on week to 1.08 million tonnes as of June 23.
The market has entered a slack consumption season, a Shanghai-based source said, adding that spot trading volume remains scant as most end-users still procure only to fulfill their immediate demand.
HRC output among those 37 mills increased over June 17-23 after just a week’s decline, inching up by 6,200 tonnes on week to 3.41 million tonnes, while the rolling capacity utilization rate also edged up by 0.16 percentage point on week to 87.03% on average during the same period, Mysteel’s data showed.
China’s domestic price of Q235 4.75mm HRC, as assessed by Mysteel, slipped by Yuan 183/tonne ($28.3/t) from June 18 to Yuan 5,339/t including the 13% VAT as of June 23 before rebounding to Yuan 5,383/t including the VAT on June 25.
Most traders trimmed their offering prices following the slump in HRC futures prices on the Shanghai Futures exchange over June 18-23. However, most lifted offer prices in anticipation of output restrictions taking effect starting June 24, the source added.
Steelmakers in Tangshan, North China’s Hebei province, are under new production restrictions starting June 24, according to Mysteel’s survey, and the curbs will be intensified over June 28-July 1 to ensure good air quality during the events to mark of the founding of the Communist Party of China on July 1.
Written by Villanelle Xia, xiayi@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
Leave a Reply