Near-term outlook on China's steel products

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

Rebar & wire rod: The prices of these longs may weaken over April 24-28, as demand will have limited room for substantial growth partly due to the expected rainy weather across many parts of the country in the coming days, while steel mills' output may decline marginally.

As of April 23, a make-up working day for China's Labour Day holiday over April 29-May 3, the national price of HRB400E 20mm dia rebar plunged by Yuan 128/tonne (18.6/t) from April 17 to hit a 4.5-month low of Yuan 3,951/t including the 13% VAT, Mysteel's assessment showed.

Hot-rolled coil: The coil price is expected to slip further this week, as many traders now are rather cautious about the market outlook, and end-users will mainly purchase the steel product to fulfill their immediate demand.

Cold-rolled coil: This price may continue to fluctuate downwards in the week ending April 28, mainly due to the dull trading atmosphere in the spot market. As for production, the total weekly output among the 29 cold-rolled coil producers Mysteel tracks nationwide reversed down 1,000 tonnes on week to 858,200 tonnes as of April 19.

Medium plate: The plate price may hit bottom this week, with market participants blaming sluggish actual demand and a lack of confidence. The production of medium plate among the 37 plate makers Mysteel samples reversed up 2.8% on week to total 1.51 million tonnes over April 13-19.

Sections: This price may have space for further declines, as market participants are not keen to stock up some quantities ahead of the holiday, and many end-users have still been constrained with their tight cashflows.

Written by Rong Zhang, zhangronga@mysteel.com
Edited by Alyssa Ren, rentingting@mysteel.com

Note: This article has been written in accordance with an article exchange agreement between Mysteel Global and SteelMint.