Steel prices to move sideways after the New Year’s Day holiday, eyes on cost support and macro expectations

Ferrous metal price stood high last week. In terms of news, Houthi’s attack on merchant ships in Red Sea suppressed China's steel export market to a certain extent. In spite of strict environmental protection-related steel production restrictions in many places, raw material market firmed up amid low inventory at ports and expected replenishing demand from steel mills before the New Year’s Day. In the spot market, overall demand was muted amid end-users’ fears of high prices.

Players in steel market will still need to pay attention to cost support and macro expectations in a short run. Recently, some steel mills in coke market mulled over the first round of price increases, but meanwhile steel mills refilled iron ore stocks ahead of the holiday. The RB2405 contract and HRC2405 contract will fluctuate within 3,900-4,050 yuan/mt and 3,950-4,150 yuan/mt.