Posted on 19 Feb 2024
Inventories of the five major carbon steel items held by Chinese steel mills sampled in Mysteel's regular survey rose by a substantial 28% over February 8-17 to reach 6.56 million tonnes as the Chinese New Year (CNY) holiday over February 10-17 disrupted deliveries.
The five major steel products comprise rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate. During the survey period, stocks of all the major steel items jumped by varying degrees with the physical market being at a standstill, the survey results showed.
The fast accumulation of finished steel stocks was in line with market expectations, as the domestic steel market entered a lull during the long break when end-users and traders had left the market to celebrate China's most important festival. Meanwhile, domestic steel mills had to reduce their pace of shipments during the week due to the slower logistics services over the holiday, Mysteel Global noted.
China's finished steel output decreased further during the survey period, as most electric-arc-furnace mills across the country suspended operations given the quietness of the domestic steel market.
Over February 8-17, total production of the five major steel items among the sampled steel producers came in at 8.04 million tonnes, down for the third week by another 1.6% from the prior week, according to the survey.
Inventories of the five major steel products at traders' warehouses in the 132 cities nationwide under Mysteel's regular survey also climbed higher over February 9-17, with the total volume up for the ninth week by another 15.7% on week to reach 24.2 million tonnes, the survey results showed.
However, market participants are optimistic about domestic steel prices after the CNY break, citing support from the cost side and their hopes for a recovery in demand from steel users, Mysteel Global learned.
Table 1 Five major steel products stocks at mills (Feb 8-17)
Product | Volume ('000 t) | WoW (%) | MoM (%) | YoY (%) |
Rebar | 3,076.2 | 31.1% | 72.0% | -12.8% |
Wire rod | 1,241.8 | 48.4% | 88.2% | -17.3% |
HR sheet | 975.8 | 14.3% | 20.1% | 8.6% |
CR sheet | 415.5 | 20.1% | 33.3% | 2.3% |
Medium plate | 845.7 | 14.8% | 17.8% | 2.9% |
Total | 6,555.0 | 28.0% | 52.8% | -8.4% |
Table 2 Five major steel products stocks at traders (Feb 9-17)
Product | Volume (mln t) | WoW (%) | MoM (%) | YoY (%) |
Rebar | 11.36 | 16.0% | 60.3% | -13.1% |
Wire rod | 3.30 | 18.2% | 66.8% | -16.1% |
HR sheet | 4.29 | 14.8% | 28.9% | -1.9% |
CR sheet | 2.44 | 16.9% | 30.1% | 7.8% |
Medium plate | 2.80 | 11.9% | 19.2% | 1.0% |
Total | 24.19 | 15.7% | 45.6% | -8.4% |
Source:Mysteel Global
