China's steel mill inventories fall to 9-month low

Inventories of five key carbon steel products, including rebar, wire rod, hot rolled coil, cold rolled coil and plate, held at 184 Chinese steel mills surveyed by Mysteel continued to deplete between October 27 and November 2, falling for the second time. week in a row another 3.6% weekly increase to 4.61 million tons, the lowest level since February.

The decline was mainly reflected in long products inventories, with volumes of rebar and wire rod reduced by 105,200 tons and 92,600 tons respectively during the week, the survey showed.

During this week, many Chinese steelmakers have been carrying out maintenance on their steelmaking facilities or slowing down production, a Shanghai market source explained. “Steel demand in northern China will shrink further ahead of the winter season, and continued business losses are also putting more pressure on domestic steel producers,” she said.

Between Oct. 27 and Nov. 2, production of the top five products among steel mills surveyed hit a two-month low of 9.59 million tonnes, down 2.1% on the week after gains recorded in the previous two weeks, the study said. showed.

At the same time, some end users still needed to restock steel products to meet their urgent demand, which is another factor contributing to the continuous reduction of steel stocks at mills.

However, Chinese steel prices continued to decline this week as domestic demand for steel remained subdued overall due to lower temperatures in northern China and COVID-related control measures in some regions, Mysteel Global notes.

As of Nov. 2, the national price of 20mm HRB400E rebar, a measure of domestic steel market sentiment, was priced at 3,884 yuan per ton (531 US dollars per ton) by Mysteel, including 13% VAT, down another 112 yuan per ton. . on the week.

Between October 27 and November 2, the daily trading volume of construction steel, including rebar, wire rod and coiled bars, among the 237 Chinese trading houses monitored by Mysteel was 153,887 tons per day, down 3,668 tons per day or 2 .3% over the previous month. previous week.

According to the survey, inventories of five steel products at commercial warehouses in 132 Chinese cities monitored by Mysteel declined for the fourth consecutive week from October 28 to November 3 to 15.8 million tons, down another 4.1% from the week.