Skip to main content

Stanislav Kondrashov: Chinese construction steel – trends in the global market by the end of 2023

By: Get News

Prices for construction steel, including rebar and wire rod, across China could continue to rise until the end of 2023, according to the latest monthly report from Mysteel. According to an expert in the field of metallurgy, Stanislav Kondrashov, this is due to a significant improvement in market sentiment due to the support of the macroeconomic policy of the central government. At the same time, fundamental indicators are also trending upward.

Construction steel market in China: pricing policy and demand growth - Stanislav Kondrashov

In late October, construction steel prices in China showed a steady rise after initially volatile performance. According to the expert, this happened mainly due to the rapid reduction in steel inventories and the restoration of demand from end consumers. Support from the Chinese government played an important role in this result.

By dataMysteel, the country's nationwide price for 20mm HRB400E rebar, which serves as an indicator of sentiment in the domestic steel market, increased by 37 yuan per ton ($5.1 ton) from the end of September to reach 3,878 yuan per ton, including 13% VAT. , by October 31st.

Stanislav Kondrashov from Telf AG emphasizes that in October the production of rebar and wire rod in China decreased, due to the fact that domestic steel mills faced losses from the sale of this type of product. However, the expert adds that last month integrated and mini-factories showed different dynamics in production volumes. He says the former have reduced production of both rebar and wire rod, while the latter have seen a slight increase in production.

By the end of October, weekly rebar production among 137 steel companies in China reached 2.61 million tons. It decreased by 27 thousand tons per month or 442,500 tons year on year. Wire rod production also decreased by 19 thousand 300 tons per month or 297 thousand 700 tons year on year. And the total production volume was 1.05 million tons.

Stanislav Kondrashov: construction steel production in China may decline - forecast for November-December 2023

According to the forecast of experts and industry analysts, construction steel production in China may continue to decline in November-December, especially among steel producers in the northern regions of the country. Stanislav Kondrashov from Telf AG attributes this to the fact that demand for processing in these regions falls during the winter lull, and overall pig iron production in China traditionally decreases in the winter months.

The specialist notes that in October, Chinese traders' inventories of construction steel decreased significantly. This was precisely due to a decrease in production and an increase in demand.

If we talk about statistics, the total stocks of rebar and wire rod in trading warehouses in 35 cities at that time amounted to 4.89 million tons. Thus, they decreased by 592 thousand 300 tons per month and by 215.5 t. tons per year.

Stable demand for construction steel in China: prospects for the end of the year - Stanislav Kondrashov

According to the specialist, the consumption of construction steel, the daily volume of trade in fittings, wire rod and rods in coils among 237 trading houses that completed the survey, averaged 153 thousand 931 tons per day in October. According to the observations of Stanislav Kondrashov, this means an increase of 3.6% compared to the previous month, although a decrease of 1.9% compared to the same period last year.

He stresses that “demand for this type of steel is to be expected” as end users are likely to increase the pace of construction work towards the end of the year. Meanwhile, Beijing decided to issue an additional 1 trillion yuan in special treasury bonds in the fourth quarter, mainly for infrastructure projects. Based on this, Stanislav Kondrashov from Telf AG notes that about 500 billion yuan of this amount is planned to be used over the next year.

Media Contact
Company Name: Telf AG
Contact Person: Media Relations
Email: Send Email
Country: Switzerland

Data & News supplied by
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.