Posted on 05 Nov 2024
Production of hot-rolled coils (HRC) among the 37 Chinese flat steel producers Mysteel regularly monitors inched down for a third week during October 24-30 to 3.03 million tonnes, slipping by another 11,000 tonnes or 0.36% on week, the results of Mysteel's weekly production survey show.
The hot-rolling capacity utilization rate among the 37 mills also nudged down by another 0.28 percentage point to average 77.48% during the same period, the survey found.
Some steel mills in North China halted their HRC production to conduct maintenance during the survey week, leading to the on-week decrease in output, survey respondents observed.
In addition, the better returns available on other steel products such as rebar also led some steelmakers to divert more hot metal away from producing the coils, they noted.
As for consumption, demand for HRC remained tepid during the survey week, with cautious buyers just purchasing hot coils to meet their immediate production needs.
Most steel industry participants, mills and users alike, were marking time last week in anticipation of further economic incentive policies being announced this week by the central government that might invigorate the sector, market watchers pointed out. This year's crucial NPC Standing Committee session is convening in Beijing this week during November 4-8, as reported.
Meanwhile, as of October 31, HRC stocks held by the 37 surveyed mills had dipped by another 1.34% on week to 792,500 tonnes. By the same day, inventories of the flat product at the commercial warehouses Mysteel monitors in 33 Chinese cities nationwide had also lost another 5.23% on week to 2.6 million tonnes.
Regarding domestic prices, China's spot price of Q235 4.75mm HRC was assessed by Mysteel at Yuan 3,577/tonne ($504.5/t) including the VAT on November 1, gaining 1.22% from one week earlier.
On the same day, the Shanghai Futures Exchange's most-traded HRC futures contract for January delivery had also risen by 0.54% on week to close at Yuan 3,559/t when the daytime trading session ended.
Source:Mysteel Global
