China: Steel inventories at CISA mills rise in early-Dec'24

The China Iron and Steel Association (CISA) has reported that total steel inventory at key enterprises reached 14.18 million tonnes (mnt) in early-December 2024. This represents an increase of 1.03 million tonnes (mnt) or 7.8% from 13.15 mnt in late-November 2024. Moreover, inventory levels went up by 520,000 tonnes(t) or 3.8% m-o-m against 13.66 mnt in early-November. In addition, compared to early-December 2023, inventory levels rose by 80,000 t or 1.5% y-o-y compared to 14.11 mnt.

Production volumes

The average daily crude steel output of CISA-affiliated mills stood at 2.024 mnt in early-December, a decrease of 3.2% compared with 2.091 mnt in late-November 2024. Moreover, output edged down by 3.4% m-o-m from 2.096 mnt in early-November.

The average daily finished steel output stood at 1.928 mnt, down by 10.9% from 2.163 mnt in late-November 2024. Y-o-y, output edged up by 0.8%.

Average pig iron output stood at 1.842 mnt in early-December, a decrease of 1.5% as compared to 1.871 mnt in late-November. However, on y-o-y basis output increased by 4.8%.

Outlook

China's steel market is expected to remain cautious in the short term, as rising inventory levels and decreasing production volumes may lead to downward price pressure. Moreover, Chinese construction steel demand is expected to weaken further in January, driven by the upcoming Chinese New Year holidays. However, rising SHFE futures keeps market sentiments mixed.