Posted on 27 Nov 2023
With the further recovery in finished steel prices, more Chinese steel mills were able to gain some profits on finished steel sales over the past week, Mysteel Global learned.
Mysteel's latest weekly survey showed that as of November 23, the profit ratio among the 247 blast furnace mills nationwide under its regular tracking had increased for the fourth consecutive week to a two-month high of 39.39%, up by another 10.39 percentage points from the prior week.
Source: Mysteel
The enhanced profitability among the Chinese steel mills was mainly attributed to the recovery of finished steel prices with the improved sentiment in the domestic market.
As of November 23, the national price of HRB400E 20mm dia rebar, a bellwether of domestic steel-market sentiment, was assessed by Mysteel at Yuan 4,069/tonne ($569/t) including the 13% VAT, still higher by Yuan 24/t on week though representing somewhat of a retreat from the seven-month high of Yuan 4,093/t recorded on Tuesday.
The improved profit margins encouraged some steelmakers to resume operation after completing maintenance on their production lines, and their finished steel output increased accordingly, Mysteel Global noted.
Over November 16-22, total production of the five major steel items comprising rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate among the sampled steelmakers across China under Mysteel's tracking had reached 9.1 million tonnes, up for the second week by another 148,700 tonnes or 1.7% on week, according to the latest weekly survey.
However, steel demand from end-users is expected to weaken gradually with the fall in temperatures in northern China during winter, Mysteel Global notes, and market participants fear this may dampen any further rise in domestic finished steel prices.
Source:Mysteel Global
