China’s cold rolled market still increases but at much slower pace

Certain increases have still continued to be seen over the past week in some regions in the cold rolled market in China, though such increases have been at a much slower rate compared with the previous week. In spite of the decrease of the overall inventory level in the main local markets, inventory pressure is still experienced by market players.

According to the latest statistics, overall cold rolled inventory in China's main markets now stands at 1,155,270 mt, slipping by 34,520 mt from the previous month, but up 16 percent compared to the corresponding period of last year. As of October 23, cold rolled inventory in Shanghai was 362,270 mt, down 1,920 mt week on week.

In September, China's cold rolled output amounted to 3,374,800 mt, decreasing by 2.86 percent compared with August, but registering an increase of 23.29 percent year on year. During September, average daily cold rolled output came to 112,490 mt, indicating a week-on-week increase of 0.43 percent. With the daily output level constantly hitting new highs, the market is still faced with the problem of excess supply.

After the continuous price increases seen in the last couple of weeks, in the current week there has been a significant decrease in the number of sales concluded at high levels. With the slow season approaching and also taking into account that no substantial improvement has been registered in the supply-demand dynamics, prices are not expected to keep rising in the coming period, but are thought more likely to trend sideways instead.