Posted on 15 Dec 2023
Finished steel inventories at the traders' warehouses across China that Mysteel's tracks decreased for a tenth straight week over December 8-14, according to Mysteel's weekly stocks survey. However, the pace of the decline slowed as steel consumption weakened with a cold spell hitting many regions of the country.
The latest survey result showed that stocks of rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate among traders in the 132 cities Mysteel monitors fell by another 103,700 tonnes or 0.7% on week during the survey week to reach 14.6 million tonnes as of December 14 – smaller than the 169,500 tonnes on-week drop in the prior period.
The slowing pace of the decline in stocks was in sync with the results of Mysteel's other survey among the 237 traders it follows nationwide, which showed that their trading volume of rebar, wire rod and bar-in-coil had retreated by 3.1% or 4,577 tonnes/day on week to average 142,899 t/d over December 7-13.
Among the five major steel items, both rebar and wire rod showed on-week rises in inventories, with the volumes mounting by 8,300 tonnes and 16,900 tonnes respectively to 5.4 million tonnes and 1.5 million tonnes as of Thursday, the survey statistics revealed.
"Currently, many traders believe domestic steel prices are at rather high levels – compared to the generally mediocre levels seen throughout the rest of this year – and they're opting to pare down their inventories so as to reduce their risks," a source based in Southeast China's Fujian told Mysteel Global.
As of December 13, the country's national price of HRB400E 20mm dia rebar under Mysteel's assessment had moved up by Yuan 36/tonne ($5/t) on week to Yuan 4,087/t and including the 13% VAT.
However, Mysteel's survey indicated that steel market fundamentals have already shown signs of weakness amid the onset of harsher winter weather, and as the earlier market optimism gradually cools down, domestic steel prices may face some downward pressure.
China's National Meteorological Center on Thursday issued an orange alert – its second-most-severe warning for winter weather events – forecasting that temperatures could suddenly plunge by 8 to 12 degrees Celsius in most parts of China from Thursday to Sunday.
In addition, steel inventories held by traders in Mysteel's former smaller sample across just 35 cities have dropped for ten straight weeks too, shedding another 70,100 tonnes or 0.8% on week at 8.7 million tonnes as of December 14, as against the 1.4% dip in the prior week.
Source:Mysteel Global
