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: Prices of the two long steel products are forecast to move up further over December 11-15, mainly bolstered by the persisting high production costs and better macro expectations.

As of December 8, China's national price of HRB400E 20mm dia rebar was assessed by Mysteel at a nearly eight-month high of Yuan 4,105/tonne ($571/t) including the 13% VAT, higher by Yuan 45/t on week.

Hot-rolled coil: This price may lose steam after rise in the week through December 15. A market source based in North China said market sentiment has recovered moderately and he is still optimistic about the near-term market outlook, though end-users are not keen to procure high-priced hot-rolled coils in large quantities.

Cold-rolled coil: This price is likely to be slightly rangebound in the week ending December 15 with the rising imbalance between production and demand. Total output of cold-rolled coils among the 29 steelmakers Mysteel tracks nationwide may grow to 840,000 tonnes this week as some mills will resume operations after maintenance works.

Medium plate: This price may fluctuate mildly over December 11-15. A Shanghai-based source anticipated the spot plate price in the local market may move rangebound at high levels on the back of firm production cost support and its solid fundamentals.

Sections: The sections' prices may increase marginally over December 11-15, which will be continuously underpinned by high raw materials costs and stronger expectations of favorable macroeconomic policies. However, the extent to which prices move up further will be limited, sources said.

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