Long steel social inventories in Guangzhou fell 140,800 mt on week

SHANGHAI, May 27 (SMM) – Social inventories of long steel (including wire rods and rebar) in Guangzhou decreased 140,800 mt or 10.24% in the week ended April 26 to 752,400 mt, showed SMM data. Stocks were 24.75% lower than the same period last year.

Rebar accounted for 752,400 mt of the social inventories, down 72,800 mt or 8.82% from a week ago and down 34.47% from a year ago. Meanwhile, wire rods inventories totalled 482,000 mt, down 68,000 mt or 12.36% week on week and up 7.37% year on year.

Steel rebar prices fell broadly this week. Prices of cold steel in Guangzhou stood at 5,000 yuan/mt as of May 26, down 550 yuan/mt from last Wednesday. Due to the rapid decline in prices, the speculative inventory accumulated at high prices in the early period fell rapidly, which lifted up the pressure of spot selling in the market. Merchants generally had a pessimistic attitude and were actively shipping and reducing inventory. Due to the large number of state-level projects in Guangzhou, the downstream rigid demand was more resilient, and the pace of end-user purchases obviously recovered with moderate low-priced transactions after prices fell. Merchants were cautious and had low willingness to build warehouses, and they generally focus on direct shipments from steel mills. Therefore, the inventories fell moderately this week.