HRC inventories decline from a year ago for 1st time since Jun

SHANGHAI, Oct 12 (SMM) – Inventories of hot-rolled coil (HRC) in China fell from a year earlier this week for the first time since a low consumption season began in June, as authorities imposed stricter curbs on steelmakers to minimise potential disruption with China marking its 70th founding anniversary on October 1.

SMM data showed that stocks of HRC across social warehouses and steel mills were 1.4% lower than a year earlier, standing at 3.41 million mt as of October 10.

Beijing celebrated the anniversary with a military parade. This, together with a sustained period of air pollution starting from late September, prompted local governments across north, central and east China to issue smog alerts and slap restrictions on production and transport. Restrictions were lifted at the start of October.

As of October 10, HRC stocks across Chinese steelmakers came in at 959,600 mt, up 2.4% from September 26 but down 8.1% from the same period last year.

In-plant HRC stocks are likely to fall, as various regions have kicked off a fresh round of production curbs.

Social inventories rose 6.9% from September 26 to 2.45 million mt as of October 10, as spot trading was muted during the week-long National Day break and also cargo freight recovered after authorities removed curbs on road transport.

On a yearly basis, HRC social stocks gained 1.4%, the smallest increase since the low season.