Steel stocks with Chinese traders remain largely stable

Chinese traders saw their stocks of the five major steel products remain generally stable over September 4-10, with the total down by a mere 3,400 tonnes on week, given the lower production, Mysteel Global noted. Actual demand remains static as well.

Total inventories of the five steel items among traders surveyed by Mysteel in 132 Chinese cities reversed down after increasing for three straight weeks to reach around 23 million tonnes as of September 10, Mysteel’s latest survey released the same day showed. The five items comprise rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate.

Among the five major steel items, rebar and wire rod witnessed the sharpest on-week declines in trader stocks. Rebar inventories moved down 49,500 tonnes on week to 12.5 million tonnes as of September 10, while those of wire rod declined by 62,200 tonnes on week to 3.3 million tonnes, the survey showed.

But market sources stressed that the fall in long steel stocks occurred not because of robust demand but through a decline in the volumes entering warehouses. “Demand for construction steel has yet to strengthen significantly – despite the approaching peak-consuming season of September-October – so mills are cutting production, given the static demand and meagre profits,” an official from a steelmaker in East China’s Jiangsu province said.

Production of the five items edged down by 9,300 tonnes on week to 10.9 million tonnes over September 3-9, according to Mysteel’s survey, with that of rebar declining the most at 107,800 tonnes on week to reach 3.7 million tonnes over the same period.

The trading volume of rebar and wire rod among the 237 traders Mysteel checks across China averaged 221,122 tonnes/day over September 3-9, being down 3,243 t/d on week, Mysteel’s data showed.

Steel inventories held by traders in Mysteel’s former smaller sample across just 35 cities, however, further rose by 25,900 tonnes on week to 15.73 million tonnes as of September 10.

This article has been published under an article exchange agreement between Mysteel Global and SteelMint.

Photo: World Steel