SHANGHAI, Jun. 12 (SMM) – The price of imported iron ore rose in May, and steel inventories in China’s domestic market are down. Will the two give a boost to steel price?
“Steel prices are likely to rally slightly after reaching bottom in June,” SMM’s steel group says.
Most domestic steel mills turn unwilling to cut the price in the face of rising prices of imported ore, which rose 42 yuan (Fe 63.5%, PB) at the Port of Qingdao in May, and some mills even reduce output, SMM survey finds.
Inventories, moreover, are falling both at traders and downstream buyers, SMM adds.
On the demand side, conditions are not very promising, especially from construction and machinery sectors, and weak demand has promoted domestic steel mills to increase steel exports, according to SMM survey.
Overall, end user demand is unlikely to pick up anytime soon, and might recover later this year from potential favorable policies, SMM points out.
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