Price trend:

National prices for mild steel plates showed a "stable with slight increase" trend, and price fluctuations for core specifications narrowed. According to SunSirs commodity market analysis system, the price of general-purpose mild plates (material: Q235B; specification: 20) was 3,252 RMB/ton on December 5th, a 0.31% increase compared to Monday.

Influencing factors

Steel billet market: Last week, domestic steel billet prices showed a weaker trend. The price of ordinary billets in Tangshan, including tax, was 2,990 RMB/ton, remaining stable compared to the end of the week before last. On the supply side, the daily external sales volume of steel billets from 21 sample enterprises in Tangshan and surrounding areas was approximately 32,000 tons last week, a decrease of 2,600 tons compared to the previous week.

In terms of demand, a "strong south, weak north" pattern emerged, with apparent consumption decreasing by 0.9% week-on-week. The northern market was affected by low temperatures, with the construction project commencement rate falling below 40%, and procurement volumes in downstream industries such as steel structures and construction machinery decreasing by 12% week-on-week; the southern market benefited from accelerated construction activity before the Lunar New Year.

In terms of inventory, national inventories of mild steel plates showed characteristics of "slight overall increase and regional differentiation." As of December 5th, the total national social inventory was 2.4258 million tons, a week-on-week increase of 2.78%, but still 8.3% lower than the same period in the past three years.

Market outlook

On the supply side, steel mills were expanding the scope of production cuts and maintenance, and national production of mild steel plates is expected to decrease by 3% week-on-week.

On the demand side, construction work in southern China was entering its final stages, and apparent consumption may decrease by 2%-3% week-on-week, while demand in northern China remains low.

Regarding inventory, the increase in national social inventory is expected to narrow to within 1%, and the East China region may continue to see inventory reductions.

Due to weak demand, domestic mild steel plate prices are expected to have further downward potential of 5-10 RMB/ton next week.

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