Declines in rebar inventories slow, supply to weigh on prices in May

SHANGHAI, Apr 26 (SMM) – China's inventories of rebar across smelters and social warehouses continued to shrink in the week ended Thursday April 25, but declines slowed from a week earlier as supplies increased. 

As of April 25, inventories across social warehouses stood at 6.62 million mt, down 4.9% on the week, compared with a decline of 7.8% a week ago. In-plant stocks across smelters shrank by 2.6% on the week and by 12.7% on the lunar year to stand at 1.93 million mt as of April 25. 

Overall inventories declined 4.4% and posted 8.55 million mt as of Thursday, after they shrank 6.6% in the prior week. 

Last week, the domestic average price of rebar continued to increase 11.9 yuan/mt on the week, to 4,170.5 yuan/mt. Fundamentals bolstered prices to the highest post-CNY at 4,203 yuan/mt on Monday April 22.

Higher prices lifted profits at steel mills and may continue to expand their output in May. This is expected to grow pressure on prices.