Posted on 14 Jun 2023
Total production of hot-rolled coil (HRC) among the 37 Chinese flat steelmakers under Mysteel's tracking gained by 35,400 tonnes or 1.1% on week to reach 3.1 million tonnes over June 1-7.
Contributing mainly to the rise in overall output was the fact that some mills in North and East China resumed production after completing maintenance shutdowns, the survey showed.
During the same survey period, the monitored mills' hot-rolling capacity utilization rate also increased by 0.91 percentage point on week to 80.12%, Mysteel's data showed.
China's Q235 4.75mm HRC edged down by Yuan 15/tonne ($2.1/t) on week to Yuan 3,869/t including the 13% VAT as of June 12, according to Mysteel's assessment.
Many traders lost confidence and trimmed their offering prices after noting the decline in HRC futures prices on the Shanghai Futures Exchange, a Shanghai-based analyst said.
The SHFE's most-traded HRC contract for October delivery slipped by Yuan 2/t from the settlement price on June 5 to Yuan 3,763/t when ending the daytime trading session on June 12.
Many end-users procured only to meet immediate production demand, while traders opted to maintain their stocks at a low level to reduce their risks, he commented.
HRC inventories held by the 37 surveyed mills Mysteel tracks had increased to 886,900 tonnes as of June 7, gaining by 14,800 tonnes or 1.7% from one week earlier.
HRC stocks at trading houses across the 33 cities under Mysteel's tracking dropped by 41,400 tonnes or 1.5% on week to 2.64 million tonnes as of June 8.
The analyst predicted that HRC prices may lose some ground during the week, as the mismatch between supply and demand will continue to weigh on prices.
Source:Mysteel Global
