China’s hot rolled coil (HRC) production fell to 14.554 million tonnes in June. This figure has decreased by 2.1 percent compared to the same period last year. Another important point is that this amount has changed significantly from the growth of 12.8% in June last year. Compared to the previous month, cold rolled coil production fell 10.1 percent in July. The price of rolling coils is likely to change in the coming months. It seems that the steel market will face a cross-sectional demand decline. In the following, we will evaluate this issue. Please be with Artan Press.
*** The average price of hot rolled coils in the Chinese market
Average local prices of HRC hot-rolled coils in China in July with rising HRC futures prices over a period of time and production constraints that support prices. For this reason, in some times, it witnessed price growth and an upward trend. In the period from January to July this year, HRC and cold rolled coil production reached 109.295 million tons, an increase of 14.1% over the previous year. Which was 2.7% less than the increase in the period January to June compared to the same period last year. The price of rolling coils is also likely to decrease in the short term.
*** Production statistics of cold rolled coils from the beginning of the year
China’s cold rolled coil (CRC) production reached 25.319 million tons in the first seven months of this year, up 18.4 percent from a year earlier. That figure was 3.0 percent slower than annual growth in the first six months. In July of this year, the output of Chinese rebar and induction coil was 21,019 million tons and 13,516 million tons. This figure decreased by 12.5 percent and 8.2 percent compared to the previous year, while the monthly decreased by 15.1 percent and 4.83 percent per month, respectively. These figures have not yet been officially released by the China Steel and Iron Association. The price of hot and cold rolled coils has come under pressure from Chinese policies.
*** The impact of rebar prices on the decline in iron ore prices
Local rebar prices in China in July showed a general upward trend. This product reached its highest level in the last days of January amid declining output and rising rebar prices. We always see a relative growth of prices in the rebar market with the decrease of iron ore prices. Rolling coil prices and rebar rates have converged significantly in recent months. This may seem a little strange. But I wish the price of iron ore would make the market harder to supply in some respects. In total, this product has been in the process of reducing prices in August until today. It seems that in the coming months, the price of rebar is likely to decline further. It seems that the demand trend in cold rolled coil is negative.
*** China rebar production statistics in July
From January to July this year, China’s rebar production amounted to 157,454 million tons, an increase of 7.2% over the same period last year. The price of cold rolled coil has also moved with a reasonable trend with production statistics. This figure, which is four percentage points slower than the increase in the first six months of this year, has become very controversial. Rebar production reached 96.372 million tons in the first seven months. This figure, which is an increase of 4.7 percent compared to the same period last year, shows that it is 2.5 percent slower than the increase in the first six months of this year. China’s steel market appears to be slowing down as production and consumption decline.
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