SHANGHAI, Feb 13 (SMM) – Slow resumption of downstream demand after holiday continued to grow China's rebar stocks, both in-plant and social inventories, in the first week after Chinese New Year.
While traders returned as of February 12, few downstream plants resumed, and this grew deliveries of rebar to warehouses.
Overall inventories, including social and in-plant stocks, increased to 10.47 million mt as of Tuesday February 12, up 3.43 million mt from Thursday January 31, the last week before CNY. On the lunar calendar basis, inventories shrank 8.64% from a year earlier, indicating a slower accumulation of stocks on the year.
SMM expects that the recovery of construction sites will lower rebar inventories in the fourth to the fifth week after CNY.
Higher inventories are likely to cap any upward momentum in rebar prices this week, while concerns over Brazil’s supply after the Vale dam accident buoyed iron ore prices in the first two trading days after the CNY holiday.
Domestic prices of rebar averaged 3,945 yuan/mt on February 12, up 71 yuan/mt from pre-CNY levels.
