The production cost in China’s steel market is high, but not enough to stimulate price rise. That’s exactly the current condition of China’s steel market.
According to latest market report, in the recent week, steel prices in spot market are basically stable, while the demand is till weak. Therefore, the general transaction is still far from satisfying.
Besides, the confidence of steel traders isn’t regained yet and even with the fact that the high production cost has given a firm support, the possibility of price rise in China’s steel market is anyhow slim.
Take China’s construction steel market as an example, except that price in Northeast China market has increased a little, prices in all other areas are going downward. As a whole, the market price in North China is already lower than that of South China, and taking the coming of colder days into consideration, the demand in North China will become weaker and steel price will correspondingly decline further.
To conclude, the weak demand and the negative influence imposed upon China’s steel market by outside factors will extend further to the future. At the same time, the strong support arising from production cost and light inventory pressure will also go hand in hand with the negative side of the market. Therefore, it’s hard to predict now where China’s steel market will go in the future.