Chinese steel plate market follows relatively stable trend

During the week ending August 15, steel plate prices in the Chinese domestic market have generally trended sideways, though with some minor decreases. Market players are pretty cautious and are maintaining a wait-and-see approach to market activity. As of August 15, average steel plate prices in the main cities are as follows:
 
 

Product name	Specification	Category	Average price (RMB/mt)	Weekly change (RMB/mt)	Price ($/mt)	Weekly change ($/mt)
Common carbon medium plate	20 mm	Q235	4,877	-20	763	-3
Low alloy medium plate	20 mm	Q345	5,010	-15	784	-2
Shipbuilding plate	16 mm	CCS A/B	5,190	0	812	0

 
At the beginning of the past week, Chinese traders were getting worried about the future prospects for the domestic steel markets due to negative factors including the reduction of the US' credit rating, the sudden slump in the US stock market, the European debt crisis, the surge in the gold price, decreases in the Chinese stock and steel futures markets and decreases in prices of construction steel and hot rolled steel. Most traders started to conclude deals in order to reduce risks. However, as of last Friday, traders became more confident again as the financial markets became steadier. Some traders with low inventory levels started to test the market with increased offer levels.
 
In July, China produced 59.3 million mt of crude steel, up 15.5 percent year on year, though with an average daily output of 1.91 million mt, which is the lowest level in the current year. On Friday, August 12, major domestic steel producer Baosteel Group announced it is keeping its September offers for steel plate unchanged from August quotations. Meanwhile, with some of its facilities undergoing overhauls during the current month, there will be a shortfall of 280,000 mt in Baosteel's steel output. Some second-tier mills in China have reduced their ex-mill offers of medium plate by RMB 40/mt ($6/mt).
 
As of August 12, aggregate steel plate inventory in the main Chinese cities totaled 1.48 million mt, increasing by 3,160 mt from the previous week.
 
It is expected that the Chinese domestic steel plate market will follow a sideways trend in the coming week.