HRC Futures Dip, Inventory Rises Amid Weak Market Sentiment

HRC futures' most-traded contract closed at 3,293 yuan/mt today, down 0.27% for the day. Spot HRC prices fell 10-30 yuan/mt, while Shanghai cold-rolled coil prices dropped 10 yuan/mt, and Lecong spot prices held steady. Trading activity in the sheets & plates market was weak throughout the day.

Today's SMM weekly balance data showed HRC production fluctuating rangebound. Although total inventory continued destocking, social inventory of HRC—based on SMM's survey of 86 warehouses nationwide (large sample)—showed some buildup, rising 21,500 mt MoM, though it remained at medium-high levels YoY.

By region, destocking continued in east, south, and north-east China, but due to significant increases in north and central China, overall inventory showed accumulation.

Looking ahead, as macro sentiment cools, market sentiment is expected to continue adjusting, with HRC prices likely to fluctuate weakly. On the demand side, follow-up support will depend on year-end stockpiling and production scheduling pace in sectors such as automobiles and home appliances.