Near-term outlook on China's steel products

Mysteel Global: 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: Prices of these two long steel products may show signs of stabilizing and even rebound over October 28-November 1, mainly backed by market expectations for further stimulus policies from China's legislature meeting, the Standing Committee of the National People's Congress, which will convene during November 4-8. However, the supply-demand imbalance for steel longs may increase with mills' rising output against the softening of actual steel consumption from end-users.

Hot-rolled coil: This price is likely to move up in the week through 1 November, due to a positive outlook for the near-term market and a recovery in downstream demand.

HRC stocks continued to empty last week, with the tonnage held by traders in the 33 Chinese cities under Mysteel's tracking declining for the seventh week in a row, down by 4.9% or 140,600 tonnes on week to sit at 2.7 million tonnes by October 24.

Cold-rolled coil: This price is expected to soften amid fluctuations in the week ending 1 November, as demand may weaken slightly with winter approaching, and spot trading activities may appear poor with many traders and end-users acting cautiously. Meanwhile, Mysteel estimates that CRC output among the 29 steel mills across China it regularly monitors would fall to 820,000 tonnes this week.

Medium plate: This price may be narrowly rangebound over October 28-November 1. In the short run, procurement of medium steel plates from downstream users may stay lacklustre, and traders are also hesitant to stock up in large quantities, according to a source based in South China's Guangdong province.

Sections: The prices of steel sections may fluctuate at low levels this week, largely pressured by the weaker-than-expected demand from end-users. The slack demand, coupled with mills' rising output after curbing measures on section producers in many parts of North China's Hebei province are lifted, will continuously suppress section prices.

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