Posted on 20 Sep 2022
Total production of hot-rolled coil (HRC) among the 37 Chinese flat steelmakers under Mysteel's tracking reached a two-month high of 3.1 million tonnes over September 8-14, gaining by 0.6% or 19,100 tonnes on week, according to Mysteel's data.
During the latest survey period, the mills' rolling capacity rate also gained by 0.48 percentage point on week to 78.98%, Mysteel's data showed.
Some mills in North and Northeast China resumed production after maintenance stoppages, leading to the rise in output, a Shanghai-based analyst said.
Demand from end-users was sluggish last week, while few speculative orders had been concluded by traders, he noted, saying that both showed the cautious mood prevailing in the market. Besides, the wide fluctuation in HRC futures prices on the Shanghai Futures Exchange (SHFE) had further dampened market sentiment.
The domestic price of Q235 4.75mm HRC under Mysteel's assessment slipped by Yuan 16/tonne ($2.3/t) on week to Yuan 4,029/t including the 13% VAT as of September 16.
In tandem, the most-traded January HRC contract on the SHFE dropped by Yuan 61/t or 1.6% from the settlement price of September 9 to close the daytime trading session on September 16 at Yuan 3,758/t.
HRC inventories held by these surveyed mills had increased by 23,600 tonnes or 2.9% on week to settle at 836,400 tonnes by September 14. HRC stocks at the trading houses Mysteel tracks across 33 cities had gained by 15,900 tonnes or 0.7% on week to 2.4 million tonnes as of September 15.
The analyst predicted that HRC prices may ease this week, as demand from end-users is likely to decline.
Source:Mysteel Global
