Posted on 03 Mar 2023
In terms of HRC, the negative effects brought about by the real estate suppression policy manifested at the end of 2021. The decline in the real estate boom directly dragged down the demand for steel in the construction industry and have a consequential impact on the demand for home appliances and construction machinery industries. Since the beginning of 2022, the downstream demand for HRC has declined significantly. Coupled with repeated domestic pandemics and unprecedented overseas interest rate hikes, the prices of ferrous metal including HRC fell sharply.
Steel mills took the initiative to reduce the production amid serious losses. In 2022, the supply and demand of HRC was weak, the sharp decline in consumption will be greater than the supply weighed on the prices. Looking forward to 2023, on the one hand, according to SMM statistics, 38 million mt of HRC capacity will be put into production, up 8.66%. However, downstream consumption is unlikely to increase and the oversupply may cause the price cuts. It is estimated that the average price of SMM HRC in 2023 will be 3,300-4,400 yuan/mt.
Source:SMM Information & Technology Co, Ltd
