Posted on 26 May 2023
Rebar production among the 137 Chinese steelmakers nationwide regularly tracked by Mysteel rebounded over May 18-24 after declining for five straight weeks, rising by 1.4% or 37,600 tonnes on week to reach 2.7 million tonnes. It was mainly because some mini-mills resumed normal operations following maintenance stoppages, the latest survey showed.
Rebar output in Southwest China's Sichuan and Guangxi, South China's Guangdong, and East China's Shandong - where many mini-mills are located - accounted for most of the on-week rise, according to the survey.
Accordingly, both rebar rolling capacity utilization and operational rate among the surveyed mills grew over the survey period, with the former reversing up 0.8 percentage point on week to 59.3%, and the latter gaining for the second week, up 0.3 percentage point on week to 46.6%.
Bearish market sentiment saw domestic steel prices keep falling, with the country's national HRB400E 20mm dia rebar price under Mysteel's assessment slumping by Yuan 140/tonne ($19.8/t) on week to Yuan 3,698/t including the 13% VAT as of May 25, hitting the lowest since May 18 2020.
In the meantime, domestic steel demand from end-users remained weak, largely owing to the hot and humid summer weather that has impacted building activities, as well as the sustained tight liquidity in the construction sector, sources said.
The spot trading volume of construction steel comprising rebar, wire rod and bar-in-coil among the 237 Chinese trading houses Mysteel follows slipped further by 17.7% or 28,759 tonnes/day on week to just 133,837 t/d on average over May 19-25.
Rebar inventories at the 137 sampled steel mills decreased for the third week to 2.3 million tonnes as of May 24, but the pace slowed to 0.3% or 7,600 tonnes on week, as against the 123,600-tonne drop in the prior week.
On the other hand, the tonnage piled at the commercial warehouses in the 35 Chinese cities Mysteel checks continued trending downwards for the 13th week, thinning by 4.1% or 263,800 tonnes on week to 6.2 million tonnes as of May 25.
Source:Mysteel Global
