Posted on 09 Jan 2023
Rebar production among the 137 Chinese steelmakers surveyed by Mysteel nationwide fell for the fourth consecutive week over December 29-January 4 and at the faster pace of 8.8% or 238,800 tonnes on week to reach a near five-month low of 2.48 million tonnes, new survey data show. During the previous week, output had dipped by only 1.9%.
Survey respondents attributed the further drop in rebar output to the fact that more Chinese steel producers, particularly the electric-arc-furnace mills, had suspended operations or reined in output with the Chinese New Year holiday drawing near.
Subsequently, both rebar rolling capacity utilization and operational rates among these surveyed steelmakers also decreased further during the survey period, with the former falling for the fourth week, down 5.2 percentage points on week at 54.3%, and the latter sliding for the third week, down 3.8 percentage points on week at 38.7%.
The survey also showed that steel mills in all regions except Northwest China recorded on-week drops in their rebar output, with those in South China's Guangdong, Central China's Henan and East China's Jiangsu, Anhui and Shandong all witnessing significant production reductions.
Spot trading of construction steel including rebar, wire rod and bar-in-coil among the 237 Chinese steel trading houses under Mysteel's tracking slowed by 10.7% on week to just 98,880 tonnes/day on average over December 30-January 5, mainly as domestic steel consumption has weakened further with the CNY holiday looming, sources said.
Meanwhile, lower output saw rebar inventories at the 137 surveyed producers thin by 6.2% or 110,200 tonnes on week to 1.7 million tonnes as of January 4, while the tonnage at commercial warehouses in 35 Chinese cities Mysteel follows rose by 12% or 467,000 tonnes on week to 4.4 million tonnes as of January 5.
In contrast to the decline in output, domestic rebar prices have been trending upwards as raw materials prices remain high. As of January 5, the national price of HRB400E 20mm dia rebar under Mysteel's assessment had gained by Yuan 62/tonne ($9/t) on week to reach a near three-month high of Yuan 4,200/t including the 13% VAT.
Source:Mysteel Global
