Posted on 18 Nov 2020
Rebar output among the 137 Chinese producers surveyed by Mysteel including integrated mills and re-rollers reversed up again over November 5-11 after the prior week’s retreat, indicating the domestic steelmakers’ strong enthusiasm for producing when the prices have been hovering high, Mysteel Global learned.
Mysteel’s latest weekly survey showed that over November 5-11, China produced 3.64 million tonnes of rebar, increasing by 1.2% on week or higher by 4.3% on year. The rebar rolling capacity utilization rate among the 137 sampled mills reversed up accordingly, growing by 0.9 percentage point on week to 79.7% during the same period.
Many domestic steel mills are ramping up production after completing routine maintenance on their steelmaking facilities, as their profit margins have improved with the sustained strength of rebar selling prices in the domestic spot market.
For example, China’s national price of HRB 400 20mm dia rebar, a bellwether of domestic steel-market sentiment, grew steadily over the past week to reach Yuan 4,124/tonne ($628/t) including the 13% VAT as of November 11, touching a new high since December 2019 after the large on-week rise of Yuan 208/t, according to Mysteel’s data.
Besides, domestic long-steel demand remains firm for the time being, thanks to the steady consumption of end-users, Mysteel Global noted. Rebar stocks held by both Chinese steel mills and traders slipped at a fast pace, boosting domestic-market optimism.
Over November 5-11, rebar stocks at the 137 mills slipped for the fifth week to a ten-month low of 2.5 million tonnes, down faster at 11.7% on week against the prior week’s decrease of 8.8%. Inventories at traders’ warehouses in the 132 Chinese cities Mysteel checks also dropped by 9.9% on week to 8 million tonnes over November 6-12, according to Mysteel’s survey.
“Domestic demand (for rebar) is expected to keep stable in the near term – with the accelerated pace of construction on outdoor projects while the balmy weather lasts – but in the long run, it may shrink as the weather in northern China will turn cold soon,” a market watcher in Shanghai said.
Written by Nancy Zheng, zhengmm@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
Table 1: Mysteel Rebar Production Survey by Region on November 11 (Unit: ’000 tonnes)
Table 2: Mysteel Wire Rod Production Survey by Region on November 11 (Unit: ‘000 tonnes)
Table 3: Mysteel Rebar Production Survey by Process on November 11 (Unit: ‘000 tonnes)
Table 4: Mysteel Wire Rod Production Survey by Process on November 11 (Unit: ‘000 tonnes)
Table 5: Mysteel Rebar and Wire Rod Stocks Survey by Region on November 11 (Unit: ‘000 tonnes)
Table 6: Mysteel Rebar and Wire Rod Stocks Survey by Process on November 11 (Unit: ‘000 tonnes)
Source:Mysteel Global
