In April, the prices of ferrous metals bottomed out. The large-scale production cuts by steel mills in February-March led to a comprehensive reduction in steel inventories, alleviating market pressure. The ferrous metals prices continued to fall after the Spring Festival. Prices of some raw materials dropped to the cost line, leaving limited room for further decline. The steel transactions recovered amid rebounding ferrous metals prices, bringing a substantial increase in ferrous metals prices in early April. In mid-to-late April, steel mills resumed production successively amid improved transactions and profits, helping fundamentals of iron ore and coal coke recover. Therefore, raw material prices rose, driving up ferrous metals prices.

Looking ahead, the prices of ferrous metals may rise first and then fall in May. The prices of raw materials still have upward room amid production resumption by steel mills in the first half of May. SMM expects steel production to return to a higher level in mid-May. Therefore, inventories will barely reduce amid sluggish downstream consumption, dragging down ferrous metals prices again.