Chinese steel market is witnessing a rebound due to demand release and falling inventory, despite the continuing period needs further observation. Analysts believed it is possible indicating affordable housing construction is going on well.
Plate market is also likely to see a rebound when construction steel prices are rising in these days. Baosteel issued its August price policy on 11th, July slightly increasing its EXW prices. Most HRC prices keep flat with part of CRC rising by CNY 50 per tonne, galvanized and galvalume up by CNY 50 per tonne. Previously, Baosteel has continuously keeping its ex-w prices in line or in correction for three months due to sluggish demand in auto industries.
Data showed last week steel prices in part of districts have stopped falling or risen slightly with Shanghai and Beijing seeing an increase in a week of CNY 30 per tonne. Billet prices also eyed sharp rise till July 8th, common carbon billet in Tangshan district was CNY 4270 per tonne up by CNY 90 per tonne. Upside down of prices between EXW prices and spot market prices have been eliminated, helping to improve enthusiasm of traders at the same time relieving pressures of further correction.
Construction steel inventory continues to drop, with total inventory of construction steel around the country at 6.8716 million tonnes last week down by 89,400 tonnes compared to that in previous weekend. The falling situation mainly happened in Northeast, North and Northwest China while inventory in East and South China still gained.
Data by CISA showed in late June national average daily output of crude steel reached 2.02 million tonnes hitting record new high again. Under such situation, the falling inventory means the demand from both construction and industries is strong.
Some analysts said they believed that affordable housing construction is going on and Q3 will be a season not so weak, despite it is an offseason for steel demand.
( Source: www.steelguru.com )