The decline on China's retail steel stocks continues

Retail inventories of the five major carbon steel products held in the commercial warehouses across China regularly checked by Mysteel thinned for the fourth consecutive week during April 3-9, the results of Mysteel's latest weekly survey show.

The combined stocks of rebar, wire rod, hot-rolled coil (HRC), cold-rolled coil (CRC) and medium plate stockpiled in commercial warehouses in the 132 cities under Mysteel's coverage had retreated by 1.7% or 380,000 tonnes on week to 22.26 million tonnes as of April 9.

Despite an on-week drop, the level was still higher by 19% compared to the corresponding period a year earlier, the same survey indicated.

Stocks of rebar, wire rod, HRC and medium plate recorded on-week falls during the period, with the volumes of rebar and HRC contributing the most to the overall inventory decline, the results show.

Specifically, rebar inventories had eased by 2.5% or by 234,100 tonnes on week to 9.32 million tonnes by April 9, while HRC stocks had retreated by 1.4% or 71,600 tonnes on week to 4.92 million tonnes as of the same day.

The speed of the overall inventory drawdown was slower by 0.4 percentage points from the previous week, partly reflecting the slowdown in the pace of the demand recovery caused by China's three-day Qingming festival break over April 4-6, Mysteel Global noted.

The apparent consumption of the five carbon steel items nationwide during the survey week stood at 8.96 million tonnes, edging down by 0.3% on week, according to Mysteel's tracking.

On the other hand, some steelmakers also steadily lifted production to enjoy the healthier profit margins being won on finished steel sales. This also applied pressure to the market, Mysteel Global noted.

The combined output of the five steel products during April 2-8 among the 137 Chinese steel mills under Mysteel's coverage reached 8.58 million tonnes, picking up by 0.8% or 69,700 tonnes on week.

China's finished steel prices declined further this week amid fading cost support and weak market fundamentals, with the national price of HRB400E 20mm dia rebar registering Yuan 3,322/tonne ($486/t) including the 13% VAT on April 8, down by Yuan 9/t from April 1, according to Mysteel's assessment.

On the same day, Mysteel assessed the average price of Q235 4.75mm HRC nationwide at Yuan 3,314/t including the 13% VAT, declining by Yuan 12/t on week.

Finished steel inventories held by traders in Mysteel's smaller sample of 35 cities also slipped further during the week. The same survey findings showed that the tonnage amounted to 13.34 million tonnes as of April 9, down by 2% or by 276,300 tonnes on week from April 2.

Source:Mysteel Global