China's prices of carbon steel cold-rolled coil (CRC) are expected to remain weak this month from the dual impact of persistently high delivery volumes to local markets and limited upside demand from end-users such as coated sheet producers, according to Mysteel's latest survey.
Domestic CRC prices have yet to show any signs of recovery, even though October with its pleasant autumn weather is considered a peak month for steel consumption in China.
On October 15, Mysteel assessed the national price of 1mm CRC at Yuan 3,929/tonne ($551/t) including the 13% VAT, slipping by Yuan 17/t from the end of September and lower by Yuan 27/t on month.
The imbalance between supply and demand is set to worsen, say market analysts, as Chinese steel producers are currently enjoying healthy profit margins on CRC sales. The mills are expecting demand to stay resilient this month so have no plan to carry out large-scale maintenance or production cuts in the near term.
Mysteel's weekly survey showed that over October 1-8, total CRC output among the 29 Chinese mills nationwide under its tracking increased for the fourth consecutive week to reach 880,700 tonnes, rising by 4.1% from one month earlier.
However, demand from end-users is not as strong as expected, which may prompt the mills and traders to cut their offers to secure deals. Meanwhile, plagued by poor order intake, many end-users are reluctant to build up stocks except for buying some coils to fulfil their immediate needs, Mysteel Global learned.
CRC inventories held by Chinese traders have accumulated under the pressure of high output at a time of depressed demand. As of October 9, the tonnage at warehouses in the 29 Chinese cities under Mysteel's regular tracking registered 2.46 million tonnes, up by 4% on month and marking the highest since April 2024.
Besides, domestic prices of hot-rolled coil (HRC) have not weakened at all recently, which may also place some pressure on domestic CRC prices due to the diminished cost-side support, Mysteel Global noted.
On October 15, Mysteel assessed China's national average price of Q235 4.75mm HRC at Yuan 3,343/t including the 13% VAT, lower by Yuan 56/t from the end of September.
Source:Mysteel Global
