Posted on 06 Feb 2025
Production of hot-rolled coils (HRC) among the 37 Chinese flat steel producers Mysteel regularly monitors totalled 3.234 million tonnes over January 24-February 4, staying largely flat from the prior week's total of 3.226 million tonnes, the results of Mysteel's production survey show.
This year's Chinese New Year (CNY) break occupied most of the survey period – spanning January 28 to February 4 – when mills generally produced as normal while their customers were on holidays, Mysteel Global noted.
During the same sample period, the hot-rolling capacity utilization rate among the sampled mills inched up by 0.2 percentage point to average 82.63%, the survey indicated.
Overall, steel mills generally maintained their normal pace of production of hot coils during the CNY break. Indeed, their narrowed profit margins and scant trading activity had dissuaded them from boosting production, sources said.
Against this backdrop, HRC inventories at both the 37 surveyed mills and at commercial warehouses in 33 cities under Mysteel's tracking mounted during the holiday, with stocks held by the sampled mills jumping by 19.2% from the pre-holiday level to 948,000 tonnes as of February 4, while those at the warehouses had climbed by a slightly more sedate 14.3% to 2.94 million tonnes by the same day.
Nevertheless, the inventory buildup in the HRC market has not sparked concerns among market participants about softening prices. In fact, total HRC stocks at the sampled mills and warehouses registered 3.886 million tonnes during the CNY break, higher by just 1,200 tonnes from the same period last year.
Healthy replenishment demand for hot coils is expected after the CNY holiday, considering that many end-users had been cautious with their pre-holiday stocking, market watchers noted. Any active purchasing going forward is likely support HRC prices, they said.
As of 16:30 Beijing time on February 5, China's spot price of Q235 4.75mm HRC under Mysteel's assessment stood at Yuan 3,478/t ($478.1/t) including the VAT, down by 0.1% from January 27, the last workday before the CNY holiday.
China's spot HRC prices around the CNY in recent years (Yuan/tonne)
Year | Prices before the CNY | CNY holiday | Prices after the CNY | |||
2021 | Feb 10 | Feb 11-17 | Feb 18 | Feb 25 | Mar 4 | Mar 11 |
4,516 | 4,661 | 4,870 | 4,964 | 4,892 | ||
2022 | Jan 30 | Jan 31-Feb 6 | Feb 7 | Feb 14 | Feb 21 | Feb 28 |
4,914 | 5,011 | 5,073 | 5,031 | 5,010 | ||
2023 | Jan 20 | Jan 21-27 | Jan 28 | Feb 6 | Feb 13 | Feb 20 |
4,223 | 4,260 | 4,211 | 4,214 | 4,286 | ||
2024 | Feb 9 | Feb 10-17 | Feb 18 | Feb 26 | Mar 4 | Mar 11 |
4,077 | 4,108 | 4,035 | 4,018 | 3,911 | ||
2025 | Jan 27 | Jan 28-Feb 4 | Feb 5 | Feb 10 | Feb 17 | Feb 24 |
3,483 | 3,478 | - | - | - | ||
Source: Mysteel
Source:Mysteel Global
