Posted on 18 Aug 2020
The stagnant demand saw finished steel stocks at 59 section steel re-rollers in Tangshan, North China’s Hebei province, at a record high of 639,100 tonnes as of August 12 since Mysteel commenced the survey in February 2017, and they had felt the serious constraint in their cash flows, local market sources shared.
Over 80% steel re-rollers in Tangshan are section mills or the core consumers of local billets, Mysteel Global understands, and their section steel stocks, increased 75,700 tonnes or a notable 13.4% on week, according to Mysteel’s latest survey.
“Spot steel trading in Tangshan was slack last week, and the pressure from the high stocks and capital stretch have dampened the local re-rollers’ enthusiasm in purchasing billets,” a market watcher based in Tangshan commented.
“More re-rollers have resumed operations (after a ban was removed since the beginning of this month), but they (the re-rollers) have been consuming mainly their billet stocks at the plants instead of booking new deliveries,” he added.
Billet consumption among the 53 Tangshan steel re-rollers did rise further by 25,200 t/d or 30% on week to 109,400 tonnes/day last week, or back to the peak in May, and their semis stocks at the yards, accordingly, decreased and at a faster rate of 85,900 or 15.3% on week to 474,300 tonnes as of August 12, Mysteel’s survey showed.
Billet stocks at the steel traders in Tangshan traders, therefore, climbed up for the tenth consecutive week to 619,900 tonnes as of August 13, or up another 46,200 tonnes or 8% on week, Mysteel’s other weekly survey across 14 trading houses in Tangshan showed.
Unsurprisingly, Mysteel’s Q235 150mm square billet price in Tangshan, thus, reversed down Yuan 20/tonne ($2.9/t) on week to Yuan 3,420/t EXW and including the 13% VAT, though still hovering at an eight-month high.
Written by Olivia Zhang, zhangwd@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
Source:Mysteel Global
