Mysteel: China’s demand for construction steel is expected to recover further in March thanks to the pleasant weather and the improvement in the financial situation of construction enterprises, according to Mysteel’s latest monthly survey released on March 11.
The prediction was chiefly based on actual volumes of construction steel bought by domestic end-users in February and their purchase plans for this month.
Mysteel’s regular tracking of over 200 construction enterprises across China showed that they purchased a total of 4.16 million tonnes of construction steel products in the past month, down by 4.4% from January.
For this month, their planned buying volume is estimated at 5.61 million tonnes, representing a quick growth of 34.9% from the actual procurement volume in February, the survey results showed. March is a traditional peak season for steel consumption in China, as outdoor construction activities across most regions of the country pick up pace with the arrival of warmer weather.
However, the recovery in spot sales of construction steel has been slower than market expectations so far this year, as cautious sentiment prevails in the domestic steel market. Many downstream steel users prefer to purchase only to fulfil their immediate needs rather than building up stocks.
Mysteel’s other survey showed that the combined trading volume of rebar, wire rod and bar-in-coil among the 237 trading houses nationwide under its regular tracking averaged 99,999 tonnes/day over March 1-11, only nudging up by 2,455 t/d or 2.5% from the average for February 13-28. The survey had been suspended from January 20 to February 12 when China’s steel market came to a standstill, with most market players leaving the market to celebrate the Chinese New Year.
China’s long steel prices have weakened continuously this month. The national price of HRB400E 20mm dia rebar, a bellwether of domestic steel-market sentiment under Mysteel’s assessment, settled at Yuan 3,360/tonne ($465/t) including the 13% VAT as of March 11, lower by Yuan 81/t from the end of February.
Note: This article has been written in accordance with a content exchange agreement between MySteel Global and BigMint
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