China mills' steel stocks down on better sales
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Stocks of the five major finished steel products at the 184 Chinese steelmakers reversed down by 1.9% on week to 6.5 million tonnes by August 5 after two weeks of climb-ups, due to better spot sales and lower production of long steel products, according to Mysteel's latest weekly survey.
The five major steel products comprise rebar, wire rod, hot-rolled coil, cold-rolled coil and medium plate, and among the total, stocks of wire rod and rebar declined the most, down 8.1% and 2.2% on week respectively over July 30-August 5, while stocks of the three flats increased slightly from a week ago, the survey showed.
"China's long steel output retreated recently, while the consumption from end-users showed signs of recovery with the end of wet season," a Shanghai-based market watcher explained, quoting the two factors has been crucial for the ebbing of mills' high steel stocks.
Over July 30-August 5, the output of these five products inched down by 0.3% on week to 10.9 million tonnes among the surveyed mills after two weeks of gains, and China's 237 trading houses reported their daily trading volume of construction steel including rebar, wire rod and bar-in-coil up 23,778 tonnes/day or 11.5% on week to 230,423 t/d on average over July 30-August 5, according to Mysteel's data.
The inventories of the five major items at commercial warehouses in the 132 cities also returned to the downtrend over July 31-August 6 after having mounted for six consecutive weeks, and the total volume eased by 1% on week to 22.8 million tonnes as of August 6, Mysteel's other survey showed.
Better demand led to higher spot steel prices, and China's national price of HRB 400 20mm dia rebar, an indicator of the domestic steel market sentiment, strengthened to Yuan 3,865/tonne ($555/t) including the 13% VAT as of August 6, hitting a 7.5-month high, or up Yuan 65/t on week, according to Mysteel's assessment.
Table 1 Five major steel products inventories at mills (Jul 30-Aug 5)
| Product | Volume ('000 t) | WoW (%) | MoM (%) | YoY (%) |
| Rebar | 3,492.7 | -2.2% | 2.3% | 30.6% |
| Wire rod | 731.5 | -8.1% | -3.2% | 5.4% |
| HR sheet | 1,120.2 | 0.2% | 8.6% | 16.1% |
| CR sheet | 331.2 | 0.6% | -2.4% | 8.8% |
| Medium plate | 861.3 | 1.2% | -2.6% | 13.7% |
| Total | 6,536.9 | -1.9% | 1.8% | 21.2% |
Table 2 Five major steel products inventories at traders (Jul 31-Aug 6)
| Product | Volume (million t) | WoW (%) | MoM (%) | YoY (%) |
| Rebar | 12.21 | -1.1% | 3.8% | - |
| Wire rod | 3.45 | -3.7% | -5.6% | - |
| HR sheet | 3.5 | 1.1% | 3.2% | - |
| CR sheet | 1.73 | -0.3% | -3.4% | - |
| Medium plate | 1.93 | -0.6% | 3.5% | - |
| Total | 22.81 | -1% | 1.6% | - |
Note: Mysteel has started publishing the new set of data regarding traders' steel inventories since March 19 to better represent the market with bigger sample sizes, and the on-year comparisons will be filled up when feasible.
Rebar and wire rod: Sample size is increased to 429 warehouses in 132 Chinese cities from the previous 215 warehouses in 35 cities.
Hot-rolled coil (HRC): Sample size is increased to 194 warehouses in 55 cities from the previous 138 warehouses in 33 cities.
Cold-rolled coil (CRC): Sample size is increased to 182 warehouses in 29 cities from the previous 134 warehouses in 26 cities.
Medium plate: Sample size is increased to 217 warehouses in 65 cities from the previous 132 warehouses in 31 cities.
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.
Photo: World Steel
