Influenced by higher steel outputs in January and February and by increased steel inventories, steel prices in China observed a significant decline in March; however, the downward trend is expected to be reversed in the near future, the China Iron and Steel Association (CISA) stated on April 19. The CISA said that, with the seasonal increase in demand and influenced by increasing inflation and also growing demand in the international market, steel prices in China in the coming period will rise slightly.
In addition, according to the CISA data, the composite steel price index for China was at 131.23 points at the end of March, decreasing by 4.42 points month on month and up 13.27 points year on year.
Regarding steel outputs, the CISA remarked that the average daily output of crude steel in China in Q1 reached 1.8879 million mt, up 8.7 year on year and up 14.3 percent compared to 1.6522 million mt in Q4 2010. The figures thus point to oversupply in the China domestic market, the CISA said.
On the other hand, at the end of March this year, in the 26 main steel markets in China aggregate inventory of the main steel products amounted to 17.89 million mt, down by 650,000 mt or 3.48 percent month on month. Entering April, the overall inventory level maintained its decreasing trend, dropping to 16.89 million mt on April 10, down by 5.61 percent from the level at the end of March, but still higher than at the end of 2010.