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. April 2 is a substitute working day in China for Tomb Sweeping Day national holiday over April 3-5.

Rebar & wire rod: The prices of these longs may climb over March 28-April 2, as demand from end-users is seen growing with COVID-19 cases decreasing in some regions across China amid local government's virus containment measures. As of March 24, rebar stocks in China's 132 cities under Mysteel's survey declined by 56,800 tonnes on week to 13.5 million tonnes.

Hot-rolled coil: This price may grow in the week ending April 2, mainly underpinned by high production costs and low supply from steelmakers. As of March 23, HRC output among China's 37 steelmakers under Mysteel's tracking stood at a low level of 3.1 million tonnes despite an on-week growth of 76,500 tonnes.

Cold-rolled coil: The price may increase modestly this week, as demand from end-users has been recovering and production costs have been hovering high. As of March 24, CRC stocks at 182 warehouses in China's 29 cities under Mysteel's tracking eased by 34,000 tonnes on week to 2.2 million tonnes.

Medium plate: The price is likely to gain over March 28-April 2, as some traders have tendency of firming their offering prices on better sentiment.

Section: This price is expected to stay narrowly range-bound in the week ending April 2, as high production costs will lend some support to the spot prices, though end-users' operations have been severely affected by the recent upsurge in COVID-19 cases.

As of March 27, the Q235 150mm square billet price in Tangshan, North China's Hebei province, gained Yuan 80/tonne ($12.5/t) on week to Yuan 4,800/t EXW including the 13% VAT, 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.