A Bearish Steel Market in May

According to the price monitoring centre of the National Development and Reform Commission (NDRC), the sales price expectation index and purchase price expectation index of the steel wholesale market in May will be 32.2% and 33.5%, respectively, down 33.6 and 32.9 percentage points from the previous month.

This is based on a survey of Chinese important steel wholesale markets. Overall, steel prices will run weakly in May. The main reasons for the continuous weakening of steel prices in April are the high supply, lower-than-expected demand and weakening cost support.

As downstream demand has not improved significantly, market panic has intensified. At present, the losses of steel mills have expanded, and this is likely to force steel mills to cut or suspend production for maintenance. Steel prices will have some support in May. But the slow recovery in the real estate market gave limited boost to steel demand.

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