BLOG: Steel market quiet, whole China travels for CNY
CNY is the most significant festival for the China, and the Chinese people always travel back from the Chinese cities or even from abroad to their hometowns or where their parents are to celebrate the special occasion if they can.
CNY, therefore, probably is the only occasion that the whole China is not much in the mood for working, and employees can be legitimate to be relaxed, chitchatting in the office about what gifts to take home, how much cash in the red packets, or whether they have successfully booked air, train, or coach tickets for the journey back home.
Many Chinese steel traders, for once, are not keen to seal deals and lock in profits during the period but to take a longer break so as to beat the traffic prior to the one-week CNY holiday, and for 2020, it means mid-January as the CNY holiday falls on January 24-30.
China's spot construction steel trading, thus, has gradually come to halt, and as of January 17, the total trading among the 237 steel traders across China hit its new low since February 15 2016, amounting to only 14,181 tonnes/day for rebar, wire rod and bar-in-coil after a consecutive decline of seven working days, a really low level compared with a normal winter-day construction steel trading volume at 150,000 t/d on average.
CNY traffic is no joke, as the country usually launches a 40-day "CNY Travel Peak", requesting all the public transportation service providers to add more flights, trains, and coaches to guarantee that the Chinese citizens will be back to their home in time for the family gather-together.
For this year, the peak was formally launched on January 10, with the Chinese government estimating that 3 billion of travels will take place during the 40-day peak via the means of rail, water, road and airplanes. And among the total, coaches will take care of 2.5 billion, rail takes care of 440 million, airplanes take car of 79 million, and ferries 45 million.
The number means that every individual Chinese among China's 1.4 billion of population will be travelling via one or more transportation means during the CNY holiday.
CNY celebration will continue to the second week though the public holiday will end on January 30, which indicates that China's steel market may stay relatively peaceful until around February 8.
Written by Hongmei Li, li.hongmei@mysteel.com
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