Monday Market Monitor - China - WEEK 24 - Dragon down on knees
Dragon land is never devoid of events either for the right or wrong reason. As the threat of power rationing came to a passé the mills went in a huddle with production pruning plans. More so with the onset of monsoon in China tune was mellowed all through.
State in its unflinching resolve to tame the flaming inflation (May 5.5%) seems set to hike lending rates for the umpteenth time taking toll on the buying.
Construction sector already devastated by the orgy of repetitive hike in interest rate was further enfeebled with arrival of monsoon. At the same time the white good and automobile sector has shown downtrend all through Q1 and Q2.
Major mills sensing trouble ahead have bulked on their prices furthering the gloom. BaoSteel took the plunge first with a reduction of CNY 200 per tonne in HRC prices for June, quickly followed by other major viz., Angang by CNY 80 per tonne and Wugang by CNY 100 per tonne.
Steel prices in China have exhibited a sudden correction after maintaining an eerie silence for over a month.
As a prelude to the power rationing production attained rampaging proportions with the daily average production touched nearly 2 million tonne in the first 10 days of May and ending up with an average of 1.94 million tonnes.
The crude steel production touched an astronomical 60.25 million tonne in May YoY and MoM growth of 7.8% and 1.6% respectively.
The surfeit in production has not been matched by gain in demand owing to restrictive measures by the government to rein inflation. It has not only severely dented the reality sector but also made the execution of state sponsored projects onerous. The much touted goal of building 10 million government subsidized residences this year seems distant. The demand in key consumer segment has slid with drop in automobile purchase by 4% and 11% YoY and MoM respectively.
The dichotomy has cast a pall of gloom over the market sentiments leading to decline in prices in since Monday (13th June).
With the Damocles hanging as the inflation perpetuated by severe drought in China is expected to surge over 5.5% in May more interest hike must be on the cards.
With the seasonality already playing melancholies tune future looks pessimistic. At the same time iron ore prices remaining high the market might looks set for a debacle.
The only silver lining can be with the exertion of production pruning and simultaneous stock depletion would just tilt the balance other way within couple of weeks. At the same time with waning finished prices the current rally in iron ore prices might be short lived clipping the cost push factor.
The Chinese Long Product Price Index CLPPI declined by 48 points last week whereas the Chinese Flat Products Index CFPPI has also gone down by 48 points. The overall price index CHISPI declined by 48 points.
| Class | 10-Jun | 17-Jun | Change | % |
| CLPPI | 7683 | 7635 | -48 | -0.6% |
| CFPPI | 7661 | 7613 | -48 | -0.6% |
| CHISPI | 7671 | 7623 | -48 | -0.6% |
CLPPI - Chinese Long Product Price Index
CFPPI - Chinese Flat Product Price Index
CHISPI - Chinese Steel Price Index
Long Products
| Category | 10-Jun | 17-Jun | Change | % |
| PI-WRC | 6356 | 6315 | -41 | -0.6% |
| PI-Rebar | 9289 | 9232 | -57 | -0.6% |
PI - Product Index
Flat Products
| Category | 10-Jun | 17-Jun | Change | % |
| PI-PLTS | 7055 | 7010 | -45 | -0.6% |
| PI-HR | 7899 | 7847 | -52 | -0.7% |
| PI-CR | 7435 | 7390 | -45 | -0.6% |
| PI-GP | 7572 | 7545 | -27 | -0.4% |
PI - Product Index
To know more about these indices please visit
http://steelprices-china.com/spi_services/spi.html
1. Long products
Billets
150*150
Q235
| Location | CNY | USD |
| Fujian Province | 0 | 0 |
| Hebei Province | -10 | -1 |
| Jiangsu Province | -60 | -9 |
| Shandong Province | 0 | 0 |
| Shanxi Province | 0 | 0 |
| Tianjin | -20 | -3 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
WRC
6.5mm
Common
| Location | CNY | USD |
| Changsha | -40 | -6 |
| Chengdu | -20 | -3 |
| Guiyang | 0 | 0 |
| Hangzhou | -90 | -13 |
| Kunming | 0 | 0 |
| Nanjing | -50 | -7 |
| Shanghai | -90 | -13 |
| Urumchi | 0 | 0 |
| Zhengzhou | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Rebars
20mm
HRB 400
| Location | CNY | USD |
| Beijing | -60 | -9 |
| Changsha | -40 | -6 |
| Chengdu | 0 | 0 |
| Chongqing | 30 | 4 |
| Fuzhou | -60 | -9 |
| Guangzhou | -40 | -6 |
| Guiyang | 20 | 3 |
| Hangzhou | -120 | -18 |
| Harbin | 0 | 0 |
| Hefei | -30 | -4 |
| Jinan | 0 | 0 |
| Kunming | 0 | 0 |
| Lanzhou | 30 | 4 |
| Nanchang | -140 | -20 |
| Nanjing | -90 | -13 |
| Shanghai | -80 | -12 |
| Shenyang | -10 | -1 |
| Shijiazhuang | -60 | -9 |
| Taiyuan | 0 | 0 |
| Tianjin | -30 | -4 |
| Urumchi | 0 | 0 |
| Wuhan | -50 | -7 |
| Xian | -10 | -1 |
| Zhengzhou | -30 | -4 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Angle
#5
| Location | CNY | USD |
| Shanghai | 10 | 1 |
| Hangzhou | 0 | 0 |
| Nanjing | -10 | -1 |
| Jinan | 0 | 0 |
| Hefei | 0 | 0 |
| Fuzhou | 0 | 0 |
| Nanchang | 50 | 7 |
| Guangzhou | 0 | 0 |
| Changsha | -30 | -4 |
| Wuhan | 0 | 0 |
| Zhengzhou | -30 | -4 |
| Beijing | 0 | 0 |
| Tianjin | 20 | 3 |
| Shijiazhuang | 0 | 0 |
| Taiyuan | 0 | 0 |
| Shenyang | 0 | 0 |
| Harbin | 0 | 0 |
| Chongqing | 0 | 0 |
| Chengdu | 0 | 0 |
| Kunming | 0 | 0 |
| Xian | 0 | 0 |
| Lanzhou | 0 | 0 |
| Urumchi | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Channel
#16
| Location | CNY | USD |
| Shanghai | 30 | 4 |
| Hangzhou | 0 | 0 |
| Nanjing | -20 | -3 |
| Jinan | 0 | 0 |
| Hefei | 0 | 0 |
| Fuzhou | 0 | 0 |
| Nanchang | 50 | 7 |
| Guangzhou | -20 | -3 |
| Changsha | -30 | -4 |
| Wuhan | 0 | 0 |
| Zhengzhou | 0 | 0 |
| Beijing | 0 | 0 |
| Tianjin | -20 | -3 |
| Shijiazhuang | 0 | 0 |
| Taiyuan | 0 | 0 |
| Shenyang | -20 | -3 |
| Harbin | -20 | -3 |
| Chongqing | 0 | 0 |
| Chengdu | 0 | 0 |
| Kunming | 0 | 0 |
| Xian | 0 | 0 |
| Lanzhou | 0 | 0 |
| Urumchi | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Beam
#25
| Location | CNY | USD |
| Shanghai | 10 | 1 |
| Hangzhou | 0 | 0 |
| Nanjing | 0 | 0 |
| Jinan | 0 | 0 |
| Hefei | 0 | 0 |
| Fuzhou | 0 | 0 |
| Nanchang | 50 | 7 |
| Guangzhou | 0 | 0 |
| Changsha | 0 | 0 |
| Wuhan | 0 | 0 |
| Zhengzhou | 0 | 0 |
| Beijing | 0 | 0 |
| Tianjin | 0 | 0 |
| Shijiazhuang | 0 | 0 |
| Taiyuan | 0 | 0 |
| Shenyang | -20 | -3 |
| Harbin | -20 | -3 |
| Chongqing | 0 | 0 |
| Chengdu | 0 | 0 |
| Kunming | 0 | 0 |
| Xian | 0 | 0 |
| Lanzhou | 0 | 0 |
| Urumchi | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
2. Flats products
HRC
4.75mm
Common
| Location | CNY | USD |
| Beijing | -40 | -6 |
| Changsha | -90 | -13 |
| Chengdu | -60 | -9 |
| Chongqing | -20 | -3 |
| Fuzhou | -40 | -6 |
| Guangzhou | -50 | -7 |
| Hangzhou | -40 | -6 |
| Harbin | -50 | -7 |
| Hefei | -120 | -18 |
| Jinan | -40 | -6 |
| Kunming | -20 | -3 |
| Lanzhou | -20 | -3 |
| Nanchang | -70 | -10 |
| Nanjing | -60 | -9 |
| Shanghai | -40 | -6 |
| Shenyang | -80 | -12 |
| Shijiazhuang | -60 | -9 |
| Taiyuan | -90 | -13 |
| Tianjin | -70 | -10 |
| Urumchi | -20 | -3 |
| Wuhan | -60 | -9 |
| Xian | 0 | 0 |
| Zhengzhou | -30 | -4 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Plates
20mm
Common
| Location | CNY | USD |
| Beijing | 0 | 0 |
| Changsha | -30 | -4 |
| Chengdu | -60 | -9 |
| Chongqing | -10 | -1 |
| Fuzhou | -20 | -3 |
| Guangzhou | -40 | -6 |
| Hangzhou | -20 | -3 |
| Harbin | 0 | 0 |
| Hefei | -70 | -10 |
| Jinan | -50 | -7 |
| Kunming | -80 | -12 |
| Lanzhou | 0 | 0 |
| Nanchang | -50 | -7 |
| Nanjing | -30 | -4 |
| Shanghai | -50 | -7 |
| Shenyang | -20 | -3 |
| Taiyuan | -40 | -6 |
| Tianjin | -10 | -1 |
| Urumchi | 0 | 0 |
| Wuhan | -50 | -7 |
| Xian | -30 | -4 |
| Zhengzhou | -20 | -3 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
Pig Iron
Z18-22
Foundry
| Location | CNY | USD |
| Kunming | 0 | 0 |
| Changzhou | 0 | 0 |
| Xuzhou | 0 | 0 |
| Linyi | 0 | 0 |
| Weihai | 0 | 0 |
| Wuan | -20 | -3 |
| Taiyuan | 0 | 0 |
| Yicheng | 0 | 0 |
| Linzhou | -50 | -7 |
| Guiyang | 0 | 0 |
| Harbin | 0 | 0 |
| Anshan | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
HR Strip
183*2.75
| Location | CNY | USD |
| Shanghai | -20 | -3 |
| Hangzhou | -20 | -3 |
| Guangzhou | -20 | -3 |
| Wuhan | -30 | -4 |
| Tianjin | 0 | 0 |
| Chengdu | 0 | 0 |
| Wuxi | -10 | -1 |
| Lecong | -20 | -3 |
| Tangshan | 0 | 0 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
CR
1.0mm
Common
| Location | CNY | USD |
| Beijing | 0 | 0 |
| Changsha | -50 | -7 |
| Chengdu | -30 | -4 |
| Chongqing | 0 | 0 |
| Fuzhou | 0 | 0 |
| Guangzhou | -20 | -3 |
| Hangzhou | -30 | -4 |
| Harbin | -20 | -3 |
| Hefei | -20 | -3 |
| Jinan | -30 | -4 |
| Kunming | -10 | -1 |
| Lanzhou | 0 | 0 |
| Nanchang | -50 | -7 |
| Nanjing | -60 | -9 |
| Qingdao | -50 | -7 |
| Shanghai | -90 | -13 |
| Shenyang | -70 | -10 |
| Shijiazhuang | 0 | 0 |
| Taiyuan | -100 | -15 |
| Tianjin | -100 | -15 |
| Urumchi | 0 | 0 |
| Wuhan | -40 | -6 |
| Xian | 0 | 0 |
| Zhengzhou | -20 | -3 |
Change is on June 17th as compared to 10th June 2011
Change is per tonne
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