In November this year, the purchasing managers' index (PMI) of the steel sector in China’s Hebei Province increased to 50.7 percent, up 5.6 percentage points month on month, as announced by the Hebei Province Metallurgical Industry Association (MIA). In the given month, the trend of the PMI for the steel sector in Hebei Province was in line with that for the whole of China, which increased by 2.6 percentage points month on month to 48.2 percent, as announced by the China Steel Logistics Committee (CSLC).
In November, the overall new order index for Hebei Province’s steel sector stood at 50.0 percent, up 7.5 percentage points compared to the previous month. Finished steel prices moved on an upward trend amid increasing ferrous metal futures prices and improved market sentiments.
In the given month, the new export order index for Hebei Province’s steel sector was at 50.0 percent, up 9.1 percentage points month on month. The improvement in Sino-US relations exerted a positive impact on steel exports.
In the given month, the production index for Hebei Province’s steel sector was at 53.5 percent, up 15.4 percentage points month on month. Steelmakers’ profitability improved following rises in steel prices and so they were more willing to produce.
At the same time, the inventory index for finished steel in Hebei Province declined to 47.6 percent, down 9.7 percentage points month on month. Demand for steel improved as some construction sites sped up construction activities.
In November, the inventory index for raw materials in Hebei Province stood at 38.4 percent, down 10.4 percentage points month on month. The relatively high levels of raw material prices made steelmakers cautious as regards building up stocks for the winter season.
As for December, demand for steel may slacken amid the cold weather and the slowing down of construction activities, which will likely weaken the support for steel prices.