WEEKLY: Near-term outlook on China's steel products

Mysteel Global: Below is the brief near-term outlook for five key steel products Mysteel shares on a weekly basis, drawing upon the results of related surveys and communication with Chinese market participants.

Rebar & wire rod: Prices of the two major long steel items are expected to see mild rises over April 20-24. Long steel inventories at traders are likely to decline faster, mainly driven by continuous downstream demand recovery and reduced output from mills, which is projected to buoy market sentiment. In addition, cost-side support is likely to remain robust, given that the second round of coke price hikes is set to materialize on April 20, alongside other elevated raw material prices amid ongoing geopolitical tensions.

Combined stocks of rebar and wire rod piled in commercial warehouses in 35 Chinese cities under Mysteel's tracking came in at 6.93 million tonnes as of April 16, down by 3.6% or 261,700 tonnes on week, a pace accelerating by 1.5 percentage points from one week prior.

Hot-rolled coil: HRC prices are projected to rise slightly this week. Higher spot trading volumes led to a decline in HRC inventories last week, though most were sold at relatively low prices. Improved downstream demand and firm prices of steelmaking raw materials are expected to uplift HRC prices this week.

Cold-rolled coil: CRC prices are likely to stay rangebound in the week ending April 24. CRC output is likely to stay largely stable this week, but downstream demand is projected to turn subdued following the fading of macro-driven buoyancy. The lingering mismatch between supply and demand would keep market participants cautious in the short run.

Medium plate: Prices of medium plates are forecast to gain mildly throughout April 24 driven by increasing consumption among end-users. But the slow pace of destocking is expected to cause most traders to stay wary towards the near-term medium plate market and continue to focus on liquidating their existing stocks.

Sections: Prices of steel sections are likely to post small gains over April 20-24 amid better market sentiment driven by some positive macro signals. Pressure from the supply side eased last week as re-rollers in North China faced mandated production restrictions. The stronger performance of ferrous futures lately also offers some support for steel section prices.

Note: This article has been written in accordance with a content exchange agreement between Mysteel and BigMint.