Flat steel production accelerates in China

SteelOrbis Shanghai Influenced by many new supplies in the market, Chinese hot and rolled product prices went down slightly last week. The trading volume also narrowed down, adding to the price decline. Hot rolled coil prices decreased RMB 30-40/mt ($4-5), and cold rolled prices decreased RMB 35-45/mt ($4-6) week on week. On the hot rolled side, steel mills had reduced the supply quantity by curbing the production through overhaul activities since the beginning of August, in order to maintain the market prices. Therefore, market inventory remained at a low level until last week. However, the mills began to increase their supply to the market now, hitting the market prices. Nevertheless, the rebound on Friday and at weekend indicates that the market is not so much inclined to going down. On the cold rolled side, the decline of the demand from the household appliances industry narrowed down the trade and caused a continuous price decrease. Because of the weak trend, traders do not have much confidence in the market. Therefore they are eager to sell their products. According to the inventory statistics by the end of the previous week, inventories in all the regions dropped somewhat. However, they are not expected to decrease any further. In short, both hot and cold rolled market prices are slighty fluctuating at the bottom, although the reasons are slightly different. The market prices are expected to continue fluctuating slightly in the rest of the week.