China: Domestic Steel Prices Inch Up, Futures Fall

At the opening of the market today, the mainstream quotation of construction steel in Shanghai market was slightly up, and the market's upward trend narrowed following the decline in rebar futures price during the trading hours

According to the data, with the pick up of temperature, the downstream demand has recovered slightly, and the overall shipment performance is acceptable.

In terms of varieties, according to the data, wire rod prices moved slightly up. Currently, the specification 6.5-10mm by Jiujiang and Zenith plants is quoted at RMB 4,020-4,080/ton (USD 583-592); the mainstream resources of rebar HRB400 edged up slightly. Now, the price of specification 18-22mm by Zenith and Shente is mostly seen at RMB 3,840-3,880 /ton. The mainstream quotation of rebar HRB400E has moved up slightly. At present, the price of specification 18-25mm by Zenith and those in the Wuhu area is prevalent at RMB 3,870-3,910 /ton.

Conference on resolving the excess capacity and prevent a resurgence of "low-quality steel made from scrap metal" in iron and steel industry held in Beijing; industry experts believe that the domestic steel market will basically remain stable; steel stocks fluctuate slightly, while the inventory of coking coal and coke increased.

Boosted by environmental protection policy billet in Tangshan rose slightly by RMB 40/ton during the weekend, driving the spot price to rise also. On Monday, the local mainstream resources opened at a slightly high position, with the rebar price by big factory being reported at RMB 3,840-3,880/ ton. However, following the fall back of rebar futures, the market's upward trend was blocked and merchants holding the wait-and-see attitude increased. Today, the temperature in Shanghai is warming up, and the downstream demand has somewhat recovered with an acceptable market transaction performance.

However, coming to the end of the year, the demand is difficult to continue to increase once after the rushing completion of the construction work, so the market outlook is not optimistic. At the same time, the recent arrival of resources is slow, and the market specifications are not complete, coupled with a relatively low level of inventory, there is still some support for the price. Therefore, it is estimated that the short-term price may be dominated by consolidation.

As the arrived resources are not much and the market inventory is low, there is some support for the spot price. The construction steel price in the short term will fluctuate upward.

source: SteelMint

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