Steel sector PMI in Hebei decreases to 51.5 percent in June

Thursday, 02 July 2020 14:06:09 (GMT+3)   |   Shanghai

In June this year, the purchasing managers' index (PMI) of the steel sector in China’s Hebei Province increased to 51.5 percent, down 2.4 percentage points month on month, as announced by the Hebei Province Metallurgical Industry Association (MIA). In the given month, the trend of the steel sector PMI in Hebei Province was in line with that for the whole of China, which decreased by 1.6 percentage points month on month to 49.3 percent.

In June, the overall new order index for Hebei Province’s steel sector stood at 52.9 percent, down 2.9 percentage points compared to the previous month. In the given month, demand for construction steel (rebar, wire rod) from downstream users slackened amid rainy weather and floods. 

The new export order index stood at 40.8 percent, down 1.5 percentage points amid slack demand due to the Covid-19 pandemic, which has caused the world economy and global trade to shrink.

In the given month, the production index for Hebei Province’s steel sector was at 53.5 percent, down 4.3 percentage points month on month.

At the same time, the inventory index for finished steel in Hebei Province rose to 48.4 percent, up 5.4 percentage points month on month. Slack demand contributed to the rises in inventory in the given month.

In addition, the raw material inventory index for the steel sector in Hebei declined to 45.6 percent, down 3.1 percentage points month on month, while the raw material purchasing index rose by 1.5 percentage points to 66.0 percent in June. The high-priced raw materials provided solid support for steel prices.

Wang Dayong, vice president and secretary general of the Hebei Province Metallurgical Industry Association, said that an increasing number of projects started construction in the second quarter of this year, speeding up economic development and stimulating the consumption of steel. However, demand shrank in June amid rainy weather and floods, which will continue to exert a negative impact on steel prices in July.

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