Chinese construction steel prices level off
Construction steel prices in Chinas major markets remained stable after a slight rise over the past week, and the transaction volume did not change much. Prices followed the upward trend of the previous week upon opening on Monday, November 14. Prices then remained steady from Wednesday through the weekend. Wire rod prices in Guangzhou diverged slightly from the trend, losing some ground on Tuesday as the deal prices of local products decreased. Compared to the previous week, the average market price and changes in Chinas main markets were as follows: 20mm HRB335 rebar price rose RMB 6/mt to RMB 2993/mt ($370); 20mm HRB 400 rebar price rose RMB 7/mt to RMB 3190/mt ($395); and 6.5mm Q235 high speed wire rod fell RMB 7/mt to RMB 3063/mt ($379). The following reasons led to the market changes over the past week: 1. Rebar prices in the Beijing market followed the upward trend of the prior week. 2. HRB400 rebar prices went up by a small amount due to the short supply of some specifications. Some steelmakers responded by putting products that were in short supply in the market. This stabilized prices in the latter part of the week. 3. Market demand did not pick up by any obvious measure, and traders were too cautious. Therefore, the price increase lacked support. 4. Supply and demand remained balanced in spite of the low market inventory, as demand was only from end users. Most traders think that the overall supply and demand will remain balanced, and prices will be stable at the current level. However, some traders feel that prices might go up due to traders positive attitudes. In summary, market inventory was low and some specifications were in short supply; however, the supply and demand managed to stay balanced in light of the bearish intermediary demand. Therefore, the market price will likely increase, and the quantity of new batches of products this week will be an important factor that influences the price trend. On the other hand, semi-finished prices that influence the production cost of steelmakers and their ex-factory prices did not change much. This factor may support the current stable market prices. SteelOrbis Shanghai