Chinese steel prices declined further on 15 March with bearish sentiment pervading both domestic spot and futures markets, partly dragged by the fragility of country’s property sector that implied sluggish downstream demand for construction steel.
On Friday, China’s national prices of HRB400E 20mm diameter rebar under Mysteel’s assessment slipped by another Yuan 39/tonne (t) ($5.4/t) on day to Yuan 3,679/t including the 13% VAT, hitting a new low since May 2020.
As for the futures market, the most traded rebar contract for May delivery on the Shanghai Futures Exchange (SHFE) also lost more ground, shedding by Yuan 63/t from Thursday’s settlement price to close the daytime trading session at Yuan 3,490/t on Friday.
Faced with continuous sharp falls in rebar prices, steel mills in Southwest China’s Yunnan and Guizhou provinces, among others, announced to implement price limits for their construction steel sales starting on 15 March, aiming to fix market sentiment and reduce losses.
Additionally, steelmakers in several provinces nationwide called for voluntary production curbs to monitor market changes, while steel mills in East China’s Shandong province also urged resistance against malicious short-selling activities in the rebar futures market, Mysteel Global noted.
The daily trading volume of construction steel comprising rebars, wire rods and bar-in-coils among the 237 Chinese trading houses Mysteel regularly tracks rebounded on 15 March, gaining a significant 35,160 t/day or 37.6% on day to reach 128,765 t/day.
As for the semis, the Q235 150mm square billet price in Tangshan in North China’s Hebei province under Mysteel’s assessment stayed unchanged from Friday at Yuan 3,310/t EXW including the VAT on Sunday.
Note: This article has been written in accordance with an article exchange agreement between MySteel Global and BigMint.