Price trend:

Last week, hot rolled coil futures prices fluctuated upwards, leading to a slight improvement in market sentiment. Some end-users and speculative buyers tentatively entered the market, but spot prices failed to keep pace, resulting in weak price transmission for galvanized steel sheets and coils. According to SunSirs' commodity market analysis system, as of December 19th, the average price of galvanized steel sheets and coils in the domestic market was 4,107.50 RMB/ton, a slight decrease of 0.30% compared to the beginning of the week.

Fundamentals: Last week's transactions were still mainly dominated by small and medium-sized orders. Downstream buyers showed limited acceptance of high prices and lacked the willingness to chase higher prices. As the end of the year approaches, the terminal market did not see the concentrated "volume-boosting" purchases common in previous years, and the weak demand continued. The overall market showed characteristics of high and stable supply and persistently weak demand, resulting in a significant slowdown in inventory reduction. According to the latest data from SunSirs, last week's overall operating rate for galvanized steel sheets was 79.93%; the capacity utilization rate was 66.77%, an increase of 0.04% from the week before last; weekly production was 952,300 tons, an increase of 6,000 tons from the week before last; steel mill inventory was 496,600 tons, a decrease of 4,600 tons from the week before last; social inventory was 1,257,800 tons, a decrease of 15,700 tons from the week before last; and total inventory was 1,754,400 tons, a decrease of 20,300 tons from the week before last.

In terms of sentiment, traders were generally cautious, focusing on actively selling goods and recovering funds. To facilitate transactions, some businesses were commonly offering a certain degree of price negotiation in actual deals.

Industry Trends: According to the China Association of Automobile Manufacturers (CAAM), in November, commercial vehicle production and sales reached 388,000 and 392,000 units respectively, representing month-on-month increases of 6.6% and 8.6%, and year-on-year increases of 18.6% and 24.4%. From January to November, commercial vehicle production and sales totaled 3.843 million and 3.87 million units respectively, representing year-on-year increases of 11.6% and 10.4%.

Market Outlook

Overall, although galvanized steel sheet and coil inventories continued to decline, the rate of decline was slow, and the inventory levels remained higher than the same period last year. The imbalance between supply and demand in the market remained prominent, and prices lacked effective demand support. Sunsirs expects that galvanized steel shett and coil prices will continue to face downward pressure in the short term.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.