Rebar production in China falls to 2-year low

Most of the mini-factories ceased operations as early as the Chinese New Year (CNY) holiday (January 31 to February 6) and their production had not yet recovered during the study week. In contrast, while many integrated factories operated normally during the yuan break, production among many in Northern China dropped sharply towards the end of the holiday in response to production restrictions placed on them to improve air quality during the Winter Olympics. Beijing from February 4 to 20, Mysteel Global notes.

Most domestic mini-mills will resume normal production during the Chinese Lantern Festival on Feb. 15 (which many in China see as the unofficial end of the Chinese New York Yuan celebration), so steel production could recover moderately. However, growth will be limited due to ongoing restrictions, survey respondents predict.

As of February 9, the rolling capacity utilization of surveyed manufacturers decreased by 2.6 percentage points. in a week to 53.5%, while the utilization rate of rolling mills at surveyed manufacturers decreased by 1.6 percentage points. up 41%, according to Mysteel polls.

Steel market sentiment in China remained broadly bullish last week, with the national price of 20mm HRB400E rebar, a barometer of steel market sentiment, reaching a three-month high of 5,032 yuan per tonne ($791.5% VAT as of on Feb. 11, or a jump of 215 yuan/tonne from Jan. 30, according to Mysteel.

Stocks of rebar at Chinese steel mills and Mysteel-controlled trading houses continued to rise last week. As of Feb. 9, volume at 137 factories surveyed rose for the third consecutive week, up 1.9%, or 62,100 tons, to 3.25 million tons, and volume at commercial warehouses in 35 Chinese cities increased for the sixth consecutive week as of February . 10, up 11.9% or 835,900 tons to 7.85 million tons.