SHANGHAI, Oct 14 (SMM) – SMM data showed that the HRC stocks across social warehouses and steel makers fell 172,600 mt or 4.6% on the week, a decrease of 13.49% than a year ago, to 3.58 million mt in the week ended October 14.
The inventories declined significantly both in the social warehouses and plants this week. The power rationing eased in south China, and the end consumption improved. Some plants were also restocking after the National Day holiday.
Inventories across social warehouses decreased 113,800 mt or 4.03% week on week to 2.71 million mt. This was 8.03% lower than the same period last year.
The cargo arrivals from north-east China at the social warehouses in east China declined this week amid the restocking demand after the holiday.
Stocks at Chinese steel makers came in at 870,500 mt, down 58,800 mt or 6.33% week on week and 26.97% year on year.
The in-plant stocks were transferred to the social warehouses more rapidly after the holiday, leading to a sharp decline in the in-plant inventory and the strong speculative demand in the market. The in-plant inventory is expected to stay low next week.
The total inventory of HRC fell significantly this week due to the lower steel mill output, especially in north China, and the higher restocking demand. The supply and demand of HRC remain weak, and the expectations of the production restrictions amid the dual control of energy consumption, the Winter Olympics, and the heating season will support the HRC prices. HRC stocks are expected to drop further this week.