Last week, steel re-rollers in Tangshan city, in North China’s Hebei province, showed some resistance to the sustained high billet price, opting for caution and choosing mainly to draw down their own stocks. Besides, sales of their finished steel products had declined when demand weakened after the brief blast of bitterly cold weather swept across much of the country’s north late last week, as reported. Their purchase inactivity “is preventing billet prices from growing further,” a Tangshan-based market watcher maintained.
Yet, on the other hand, the semis’ price is also finding support from the fact that since November 18, re-rollers have been released from an emergency 10-day production ban and thus, their consumption of semis will gradually gain pace.
Over November 12-18, consumption of billets among the 53 steel re-rollers which Mysteel surveys weekly averaged a mere 20,500 tonnes/day, down by a huge 40,900 t/d or 66.6% on week. The average was also way below the level of above 80,000 t/d when these re-rollers are in normal production.
Consequently, supply was comparatively sufficient last week, with daily sales from the ten steel mills in Tangshan and nearby areas Mysteel monitors totalling 43,800 t/d, despite a decline of 4,500 t/d on week.
Hence, 14 trading warehouses in Tangshan saw their stocks of billets reverse up last week by 14,400 tonnes or 5% on week to 302,500 tonnes as of November 19, ending nine consecutive weeks of decline.
At the same time, billet stocks held by those 53 re-rollers continued to grow last week, rising by another 30,300 tonnes or 5.5% on week to 581,200 tonnes. The sampled re-rollers’ billet stocks had thus increased for four weeks in a row, according to Mysteel’s weekly survey.
Written by Olivia Zhang, firstname.lastname@example.org
Edited by Russ McCulloch, email@example.com