WEEKLY: China finished steel output down, stocks rising
China’s rebar output among these mills fell by 187,800 tonnes on week in comparison with the total decline of 297,900 tonnes for the five products also including wire rod, hot-rolled coil, cold-rolled coil, and medium plate to a total of 9.4 million tonnes China’s 184 producers including integrated and mini mills under Mysteel’s steel production survey.
Despite a
continuing decline in steel output, stocks of the five finished steel products
both at the 184 steel mills and the warehouses in 35 cities under Mysteel’s
surveys built up further to 26.1 million tonnes as of February 5 from 23.3
million tonnes by February 1 because of the disruption of the transportation in
many parts of China and the remaining suspension of the construction sites in
most of China in the middle of the outbreak of the Novel Coronavirus
(2019-nCoV).
As of February 5,
steel inventories at the steel mills grew another 1.5 million tonnes from
February 1, among which, the rebar inventory grew by 816,400 tonnes, and as of
Wednesday, another 1.3 million tonnes of finished steel added to the existing
stocks at the warehouses in the 35 cities, totaling 16.3 million tonnes as
against 15 million tonnes at the start of February.
Both the increases
in steel stocks were within market expectation, though the speed of building up
may slow down in the coming weeks as many Chinese steel mills may opt to curtail
their hot metal, crude steel or finished steel output as the counter measures should
the domestic steel consumption stay in a lull.
China is expected
to resume normal operations starting February 10 with people returning to their
offices, but uncertainties remain, as over 20 Chinese cities, big and small including
Wuhan in Central China’s Hubei province, the epicentre of the virus outbreak,
have been locked down by the local authorities as part of the efforts to battle
against the spread of the virus, and citizens from the affected cities will not
be able to leave their residences.
On the other hand,
many construction sites are expected to resume operations on February 10 at the
earliest but some local authorities in the areas that have been seriously hit
by the virus have announced to delay the resumption of their construction
projects until early March.
Written by Hongmei Li, li.hongmei@mysteel.com
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