Near-term outlook on China's key steel products

Below is the brief near-term outlook of the five key steel products Mysteel shares on a weekly basis, drawing upon the results of related surveys and communication with the Chinese market participants.

Rebar & wire rod: The prices of these longs may be narrowly rangebound over January 17-21, as demand will subside with most end-users taking their breaks this week for the Chinese New Year (CNY) holiday over January 31-February 6.

As of January 13, rebar stocks at the 429 commercial warehouses in China's 132 cities under Mysteel's tracking had surged by 6.5% on week to 5.5 million tonnes amid winter restocking.

Hot-rolled coil: This price may slip in the week ending January 21, as spot trading volume has remained low amid the growing output from steelmakers. As of January 12, HRC output among the 37 steel producers under Mysteel's tracking had grown for the third week by another 1.8% on week to 3.1 million tonnes.

Cold-rolled coil: The price may ease this week, as most end-users are reluctant to take some tonnage ahead of the CNY holiday, though CRC supply is likely to pick up with the production resumption among steelmakers after completing their regular maintenance.

Medium plate: The price is likely to retreat over January 17-21, as stocks at the commercial warehouses nationwide have mounted with lukewarm spot trading activities and more new arrivals. By January 13, plate stocks at the 217 commercial warehouses in China's 65 cities under Mysteel's survey had increased for the third week by another 2% to 1.9 million tonnes.

Section: This price is expected to be narrowly rangebound in the week ending January 21, as most mills are likely to firm their ex-works prices on high production costs. The price of the Q235 150mm square billet in Tangshan, North China's Hebei province, edged up by Yuan 10/tonne ($1.6/t) on week to reach Yuan 4,380/t EXW including the 13% VAT as of January 16, according to Mysteel's assessment.

Written by Villanelle Xia, xiayi@mysteel.com

This article has been published under an article exchange agreement between Mysteel Global and SteelMint.