Posted on 02 Jun 2023
The stocks of finished steel products held in the warehouses of the Chinese traders regularly tracked by Mysteel declined for the fourth successive week over May 26-June 1, thinning by another 609,800 tonnes on week, the latest survey shows. The drop was mainly attributed to the rise in spot trading volumes and the replenishment needs of end-users, survey respondents said.
The stocks of rebar, wire rod, medium plate, hot-rolled coil and cold-rolled coil among traders in 132 cities Mysteel samples decreased by 3.2% on week to refresh a 4.5-month low of 18.3 million tonnes as of June 1.
Among the five items, rebar again posted the largest on-week decline in stocks, with the volume emptying by 409,700 tonnes on week to 8.3 million tonnes as of Thursday. Meanwhile, wire rod stocks fell 111,800 tonnes on week to 2.5 million tonnes.
Mysteel's survey on the daily trading volume of construction steel including rebar, wire rod and bar-in-coil among 237 Chinese trading houses it follows showed that trades had averaged 150,751 tonnes/day over May 25-31, higher by 12.3% or 16,524 t/d on week.
However, market sources said that although stocks digestion had stayed steady during the survey period, prospects over the short term remain slightly negative.
"Many traders in our local market hold an increasingly bearish stance towards the market outlook due to the declines in finished steel prices, and demand from end-users has yet to truly show a pick-up," said an industry watcher in Southeast China's Fujian.
"There is a possibility that traders' stocks will accumulate next week, as steelmakers in this region are likely to maintain stable production," he added.
As of May 31, China's national price of HRB400E 20mm dia rebar, a barometer of the country's spot steel-market dynamics, had lost a further Yuan 55/tonne ($7.7/t) on week at Yuan 3,680/t including the 13% VAT, the price's lowest since May 9 2020, according to Mysteel's assessment.
Steel inventories held by traders in Mysteel's former smaller sample across just 35 cities declined further too, dropping by 499,200 tonnes or 4% on week to reach 11.9 million tonnes as of June 1.
Source:Mysteel Global
