Posted on 14 Feb 2023
Total production of hot-rolled coil (HRC) among the 37 Chinese flat steelmakers under Mysteel's tracking had increased for the fourth week by another 0.7% or 21,100 tonnes to 3.1 million tonnes over February 2-8, as some steelmakers resumed operations or ramped up production.
The on-week growth in HRC output was chiefly contributed by mills in Northeast, North and East China, Mysteel's survey showed.
During the same survey period, the monitored mills' hot-rolling capacity utilization rate also increased by 0.54 percentage point on week to 78.73%, Mysteel's data showed.
Meanwhile, China's domestic price of Q235 4.75mm HRC under Mysteel's assessment gained by Yuan 21/tonne ($3.1/t) on week to reach Yuan 4,230/t including the 13% VAT as of February 10.
Many traders gained confidence and lifted their offering prices after noting the rise in HRC futures prices on the Shanghai Futures Exchange (SHFE), a Shanghai-based analyst said.
The most-traded HRC contract for May delivery on the SHFE, for example, closed the daytime trading session at Yuan 4,141/t as of February 10, up by Yuan 85/t from the settlement price on February 3, according to the exchange's data.
Most end-users resumed their normal operations last week, leading to the rise in demand for HRCs. Besides, traders shared a bullish sentiment on the prices, since there was not much pressure from HRC stocks, the analyst commented.
HRC inventories held by the surveyed 37 mills eased by 8,100 tonnes or 0.9% on week to 918,800 tonnes as of February 8, while HRC stocks at trading houses across the 33 Chinese cities under Mysteel's tracking gained by 19,500 tonnes or 0.6% on week to 3.1 million tonnes as of February 9.
Source:Mysteel Global
