China steel market runs vulnerably since September and oversupply continues. Steel price retreats after correcting for some time. Steel price falls at domestic spot market, rebar futures price remains weak, crude steel production sustains high and buying activities from steel consuming industries slacken over the past week. Transaction in the marketplaces performs bleak and pessimistic sentiments spread amid traders.
Medium plate price posts a significant drop with the range of CNY 10 to CNY 60 per tonne in Shanghai, Guangzhou and Beijing within one week. HR coil price heads south amid fluctuation with enlarging decline. Construction steel price retreats with a weekly fall of 10-50 yuan per tonne in Shanghai, Beijing and Tainjin. Construction sites are slowing down buying activities. Therefore, market transaction is hard to uplift even on steel price fall, which causes pessimistic sentiments on the marketplaces.
Iron ore price remains volatile. Domestic iron ore concentrates price keeps stable in Hebei province and transaction is bleak on the whole. Steel mills are not enthusiastic in purchasing and keep domestic ore inventory low. Imported ore price continues rising. Platts 62 Fe content iron ore price index was USD 135 per tonne, a rise of USD 3 from last week. The replenishment in some steel mills pull imported ore price up. However, delivery from global three iron ore giants boosts and ocean freight retreats after a rise, which might lead to downfall in imported ore price in the near future.
Due to oversupply pressure and deficiency of rise in downstream demand, China steel market stays vulnerable since September. As per forecast by China Iron and Steel Association, China's daily crude steel production for early October might be 2.1281 million tonnes, down 1.11% compared to mid October. It remains high and oversupply will last, which is hard to resolve in the short term. Therefore, China steel market is expected to remain bleak.