Posted on 09 Jun 2023
The finished steel inventories held by Chinese traders sampled by Mysteel thinned for the fifth straight week during June 2-8, falling by another 2.5% on week, the latest survey data show. Survey respondents cited enhanced trading activities for the dip after steel market sentiment had improved moderately.
The stocks of rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate among traders' warehouses in the 132 cities Mysteel surveys declined by 461,800 tonnes on week to 17.9 million tonnes as of June 8, Mysteel's data showed.
Spot sales of construction steel including rebar, wire rod and bar-in-coil among the 237 Chinese trading houses Mysteel tracks averaged 161,538 tonnes/day over June 1-7, higher by 7.2% on week.
Meanwhile, China's national price of HRB400E 20mm dia rebar, a barometer of the country's spot steel-market sentiment, had rebounded by Yuan 120/tonne ($16.8/t) on week to Yuan 3,800/t including the 13% VAT as of June 7, according to Mysteel's assessment.
However, the persistent and intense rainfalls in parts of southern China have impacted end-users' demand, sources said.
During the survey period, rebar stocks showed the largest on-week decline among the five items, with inventories falling by 212,300 tonnes on week to 8.1 million tonnes, about half the prior week's 409,700 tonne-fall, the data found.
The arrival of the rainy season has hampered actual demand from end-users. "Recent heavy downpours have caused work on some local construction sites in cities such as Nanning and Liuzhou to be suspended this week," said a market insider based in Southwest China's Guangxi.
China's southern regions are forecast to experience heavy rains continuously during June 8-10, the country's National Meteorological Center said on Thursday.
In addition to the rainy season factor, the ongoing national college entrance exam period (over June 7-9) has also impacted the release of demand from building contractors nationwide as building work near examination venues has had to be curtailed, as reported.
Steel inventories held by traders in Mysteel's former smaller sample across just 35 cities fell again over June 2-8, with the tonnage down 2.7% or 322,600 tonnes on week to 11.6 million tonnes.
Source:Mysteel Global
