SHANGHAI, Aug 27 (SMM) – The rebar output increased slightly by 0.83% week on week, and apparent demand of rebar increased by 0.55% from the previous week.

Inventories of rebar across Chinese steelmakers and social warehouses stood at 11.24 million mt as of August 26, down 115,400 mt or 1.0% from a week earlier. Stocks are down 342,100 mt or 3.0% from a year earlier.

The output increment of rebar is mainly contributed by south China. The decline in the total stocks at plants accelerated mainly due to some steel mills were under maintenance in east China. At the same time, the stocks were transferred more rapidly from plants to social warehouses amid the alleviated pandemic impact.

Inventories at Chinese steelmakers decreased 89,400 mt or 2.6% from a week earlier. And stocks are 243,500 mt or 6.7% lower than the same period last year.

Rebar prices bottomed out this week, and the most trade SHFE rebar registered the largest increase by 395 yuan/mt, which boosted the market trade. As the peak season is approaching, and the pandemic has eased in many regions, the social inventories of rebar basically fell across the country, except for the north-west regions.

Inventories at social warehouses declined 25,900 mt or 0.33% on the week and stood at 7.83 million mt, 98,500 mt or 1.2% lower than a year ago.

Rebar prices rebounded significantly this week, but spot traded did not pick up, and the market was reluctant to accept the high prices. According to SMM survey, the orders received by steel mills were not abundant amid lower demand, but 52% of the sample end companies reported that they will accelerate the construction in September, so the steel demand by construction industry is likely to rebound significantly in the next three months. Considering the tight supply under production restrictions, rebar inventories are expected to decline faster.