China's retail steel stocks slide further on week

Retail stocks of the five major carbon steel items held by the Chinese traders that Mysteel regularly checks declined for the third consecutive week during October 23-29, according to Mysteel's latest survey result.

As of October 29, the combined inventories of rebar, wire rod, hot-rolled coil (HRC), cold-rolled coil (CRC) and medium plate held by traders in the 429 commercial warehouses in 132 cities Mysteel monitors had declined by 1.8% or by 309,000 tonnes on week to 17.2 million tonnes, the survey results indicated.

By product, stocks of rebar, wire rod, HRC and CRC posted on-week declines, with rebar and HRC contributing the most. Specifically, rebar stocks had eased by 4% or 233,700 tonnes on week to 5.67 million tonnes, while HRC inventories had thinned by 1.5% or 74,700 tonnes on week to 4.82 million tonnes as of the same day.

In contrast, inventories of medium plate rose for the sixth consecutive week, indicating weakening market fundamentals for the commodity.

Improving though still meagre profitability among domestic steelmakers prompted them to lift their production pace slightly during the survey period, leading to an increase in domestic finished steel output, Mysteel Global noted.

During October 22-28, the combined output of the five carbon steel items totaled 7.98 million tonnes, rising by 0.7% or 57,500 tonnes on week, the results of another Mysteel survey showed.

Transactions in the physical market remained subdued this week as market pessimism still lingers, with the daily trading volume of rebar, wire rod and bar-in-coil among the 327 trading houses under Mysteel's tracking averaging 87,292 tonnes/day over October 22-28, contracting by 4.1% or 3,732 t/d on week.

The weak market sentiment had also weighed on prices of major finished steel prices, with Mysteel assessing the national price of HRB400E 20mm dia rebar at Yuan 3,302/tonne ($495.6/t) on October 28, down by Yuan 21/t on week.

Likewise, the national price of Q235 4.75mm HRC had dropped by a larger Yuan 49/t on week to sit at Yuan 3,324/t on the same day, according to Mysteel's assessment.

Meanwhile, finished steel inventories held by traders in Mysteel's smaller sample of 144 warehouses in 35 Chinese cities also declined throughout the week, with the tonnage assessed at 10.31 million tonnes as of October 29, down by 2.9% or by 311,000 tonnes from October 22.

Source:Mysteel Global