Price Trends

According to the SunSirs Commodity Market Analysis System, prices for color coated steel sheets remained stable last week. On April 20, the market price for color coated sheets stood at 6,333 RMB/ton; by April 24, the price remained unchanged at 6,333 RMB/ton. Prices thus held steady compared to the week prior, though they represented a decline of 4.766% compared to the same period last year.

Analysis and Commentary

Galvanized Sheet: Last week, prices for galvanized sheet saw a modest increase. On Friday (April 24), the price stood at 4,185 RMB/ton—up 1.405% from the week prior, but down 3.169% compared to the same period last year. Downstream demand within the coated and plated steel market remained lackluster, resulting in sluggish market trading activity.

Last week, the supply of the five major steel product categories totaled 8.6322 million tons—a week-on-week increase of 78,900 tons, or 0.9%. Total inventory for these five categories stood at 17.0256 million tons, marking a week-on-week decline of 621,200 tons, or 3.5%. The weekly apparent consumption of these five major steel categories reached 9.2534 million tons, up 2.4% from the previous week; specifically, consumption of construction materials rose by 6%, while consumption of flat products increased by 0.3%.

Cost Side: Raw Materials Strengthened, Support Intensified

1. Upstream Raw Materials: Prices for hot-rolled coils and cold-rolled substrates have risen; specifically, the price for cold-rolled substrates in Tangshan reached 3,230 RMB/ton—a weekly increase of 40 RMB/ton—directly driving up processing costs for color-coated steel and intensifying cost pressures on steel mills.

2. Steel Mill Pricing Adjustments: Baosteel and Shougang raised their base prices for color-coated steel by 100 RMB/ton for May deliveries. This follows a broad price hike of 200 RMB/ton implemented by major steel mills in April; while the logic of cost pass-through is evident, the downstream market is slow to absorb these increases.

3. Current Profit Margins: Processing margins remained razor-thin. The combination of "high costs and low demand" was squeezing profitability, leading many private mills to align their pricing with prevailing market rates—often by sacrificing margins to prioritize sales volume.

Supply Side: Operating rates remained steady, and supply was relatively stable

Capacity Utilization: The operating rate among a sample of nationwide color-coated steel mills stands at 87%, with an average daily output of 37,600 tons—essentially flat week-on-week. Supply remains at a medium-to-high level, showing no significant fluctuations.

Inventory Performance: Social inventories are undergoing a slow depletion, though they remain relatively high year-on-year. The transfer of inventory from steel mills to the market has been sluggish. Merchants are prioritizing "clearing stock to reduce inventory and accelerating turnover," resulting in expanded room for price negotiation.

Demand Side: A Subdued Peak Season, Driven Primarily by Essential Demand

1. End-Market Structure:

Construction/Steel Structures: Weakness in new real estate starts—coupled with limited support from "guaranteed delivery" initiatives—has resulted in subdued project commencements and insufficient growth in new orders; this constitutes the primary driver behind the currently weak demand.

Home Appliances/Automotive: Demand remains stable, driven primarily by essential-need, small-batch orders; the absence of concentrated inventory restocking efforts limits the upward pressure on prices.

2. Trading Characteristics: Downstream buyers are adopting a strategy of "on-demand purchasing, high-frequency small-lot orders, and restocking on dips." They exhibit significant resistance to high prices, speculative demand remains sluggish, and overall trading volume is moderate.

3. Export Pressure: Ongoing anti-dumping measures abroad (e.g., South Korea's anti-dumping duties on color-coated steel from China, ranging from 22.34% to 33.67%) have led to a year-on-year decline in exports. As the export channel's capacity to absorb surplus domestic supply diminishes, pressure on the domestic supply market is intensifying.

Market Outlook

In summary, the price of color-coated steel sheets is currently hovering near its annual low point, suggesting significant upside potential. However, given that the moving averages have not yet crossed either upward or downward, prices are likely to remain relatively flat in the short term.

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