According to a new report issued by the China Iron and Steel Association (CISA), steel prices in China in October edged down slightly amid the slacker demand for steel due to cold weather conditions in some regions of China.
There are a number of factors that participants in the Chinese finished steel market should pay attention to in the November-December period, the CISA stated.
First of all, the crude steel output in October rose by 11 percent year on year due to the relatively low base of steel output in the first six months of the current year. However, demand for steel was not as good as market players were expecting in the traditional peak season of September and October.
Secondly, import iron ore prices indicated a rebounding trend, for instance, as of November 16, import iron ore prices rose to $97.32/mt, up by $17.94/mt or 22.6 percent compared to the end of October. However, in the given period, finished steel prices indicated a slightly declining trend, signaling that steelmakers should pay attention to cost reduction and profit improvement.
Though the weather is getting colder and colder in November, production restrictions will be implemented in some regions of China, which will bolster steel prices from the supply side, and so market players thought that a demand-supply balance in the steel market would be maintained in November. In this context, steel prices in the Chinese domestic market will likely fluctuate within a limited range in the coming weeks.
