China's HRC output edges up on week

Production of hot-rolled coils (HRC) among the 37 Chinese flat steel producers Mysteel regularly monitors totalled 3.19 million tonnes over November 14-20, ticking up by a small 33,400 tonnes or 1.08% on week, the results of Mysteel's weekly production survey show. 

The hot-rolling capacity utilization rate among the 37 mills also gained 0.85 percentage point to average 79.67% during the same period, the survey results found. 

Behind the on-week rise in hot coil output was the fact that some steel mills in Northeast China lifted throughput on their hot strip mills during the survey week after conducting maintenance, survey respondents noted. 

Steelmakers chose to maintain or even expand their HRC production during the survey period, mainly in response to a slight rebound on hot coil derivatives prices and resilient buying of the flat product among end-users, Mysteel Global learned. 

Even though the improvements have only been slight, domestic HRC spot and futures prices had both trended upward during most of last week. By November 22, the spot price of Q235 4.75mm HRC under Mysteel's assessment had risen by 0.17% on week to Yuan 3,536/tonne ($488.08/t) including the VAT. 

On the same day, the Shanghai Futures Exchange's most-traded HRC futures contract for January delivery also closed the daytime trading session higher by 0.82% on week at Yuan 3,448/t. 

Meanwhile, HRC stocks held by the 37 surveyed mills had eased by 1.43% on week to 784,000 tonnes by November 21. 

Similarly, also as of last Thursday HRC inventories at the commercial warehouses Mysteel monitors in 33 Chinese cities nationwide had declined for a tenth straight week to sit at 2.37 million tonnes, down by another 2.44% on week.

Source:Mysteel Global