SHANGHAI, Mar. 28 (SMM) – Steel mills has kept the proportion of traders’ hot-rolled coil orders high in April as follows:
Shougang: 90%, compared with March’s 70%
Ansteel: 100%, flat at March’s level
Shagang: 80%, compared with 90% in March (the proportion was lower from March as the delivery in March was impeded by maintenance of its 1450 rolling unit)
Proportion of orders at steel mills for April remained high according to the above figures. This was due mainly to the large steel mill inventories caused by limited contracts signed for March and hot-rolled coil prices which were RMB 200-300/mt higher than rebar prices. Based on Steelease analysis, hot-rolled coil prices fell during June-August last year with proportion of orders over the period at 80-100%, while prices increased from September to December during which the proportion of orders were below 50%.
The high proportion of orders at steel mills will result in excess inventories, which may negatively affect prices should demand remains unimproved.