Chinese steel market had been warming up for some time emanating signals of an imminent revival. The build up to the revival was slow but sure probably indicative of its durability as H2 commences. A resounding gain of 1% within 2 days has sent the cinders flying.

Some of the reasons for the possible turn of fortune are as
1. Demand from the budget housing picking up as years draw to close exerting pressure for completion of yearly targets
2. Power shortage culminating in production cuts in the rolling mills
3. High input material costs e.g. iron ore
4. Urbanization going on gradually in the tier 2 & 3 cities.

Market prices in August opening showed the spot prices on key steel markets like Beijing and Shanghai edged up steadily, with largest growth in construction steel of east China, around CNY 30 per tonne to CNY 50 per tonne. In July alone the average price of 20mm HRB 335 rebar of 25 main cities rose by CNY 101 per tonne and average price of 3.0 mm HRC in 24 main cities increased by CNY 64 per tonne.

CLPPI - Chinese Long Product Price Index
CFPPI - Chinese Flat Product Price Index
CHISPI - Chinese Steel Price Index

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