China's construction steel demand to slip faster in Dec'24

Mysteel Global: China's demand for construction steel is expected to cool more rapidly this month, due to the further shrinking of consumption in northern China where winter is having its usual chilling effect on consumption, according to Mysteel's latest survey released on Thursday.

The prediction was chiefly based on the actual procurement volume of construction steel among domestic end-users last month and their purchase plans for December.

During November, the more than 200 construction enterprises nationwide under Mysteel's tracking purchased a total of 6.68 million tonnes of construction steel, lower by 2.2% from the prior month. Moreover, their planned buying volume for this month may decline at the faster pace of 5.1% on month to reach 6.34 million tonnes, the results showed.

The continuous fall was in line with market expectations, as more construction companies are seen halting operations gradually ahead of Chinese New Year in late January. Many domestic construction enterprises are refraining from building up stocks as they are aiming to keep their inventories at a low level to reduce risk, Mysteel Global learned.

Transactions of construction steel in the country's physical market have showed signs of slowing down so far this month. Over December 1-12, the daily trading volume of rebar, wire rod and bar-in-coil among the 237 Chinese trading houses under Mysteel's regular survey reached 114,933 tonnes/day on average, down by 694 t/d from the average for November.

However, construction steel prices in China have recovered recently, after the annual Central Economic Work Conference in Beijing over December 11-12 heard central government officials pledge to implement more proactive and effective macroeconomic policies to expand domestic demand next year. Their comments helped boost steel market sentiment, as reported.

As of December 12, the national price of HRB400E 20mm dia rebar, a bellwether of domestic steel-market sentiment, was assessed by Mysteel at Yuan 3,533/tonne ($485/t) including the 13% VAT, higher by Yuan 88/t from the end of November.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.