Get Ready to Fill Your Inventory for Steel Billet from China in 2016?

Since November 2015, some steel mills in China continue to report negative news. It makes the steel industry become a target of public criticism. At the moment the whole steel market is very tight. Many merchants do not dare to deal with steel mills, which resulting in steel mills increasing financial pressure. And at that time most steel enterprise are at a loss, and the bank also began to press for debt payment. In the case of various pressures, more and more steel mills have to reduce and limit production.

Into the middle of December 2015, the hot-rolled sheet steel and strip resource in short on the market. Meanwhile, steel rebars futures prices is rising, which makes prompt goods hot rolled sheet and strip prices took the opportunity to move up. By this time, it is centralized delivery time for the steel billet export orders, which makes market liquidity resources too few, so steel billet prices also took the opportunity to raise. Many downstream plants began to fill the inventory, which caused the market in the situation of short supply. At the end of 2015, steel billet price ushered in the "bull market", so the steel mill’s financial pressure is also solved. 

In the year 2016, with China's traditional Spring Festival is approaching, so the steel billet supply and demand will come to conflicts or aggravate before China's traditional Spring Festival. Because some construction sites began to shut down, some steel rolled plant overhauling with stopping production, and some the downstream plants also take a holiday early. However, the whole process steel enterprises is still producing, they rarely have temporarily stop-production plan.Some authorities believe that after China's traditional Spring Festival, the steel market will be reproduced hype storm, then there will be a wave of steel prices rebound.

On the whole, at the short-term before the vacation, the steel billet prices are still downside, but the space is not great. And after the holiday, the steel market rebound is very likely. It is suggested that the downstream factories fill inventory for steel billet appropriately.

Want to know more price change? Please contact me freely. China National Building Materials Group Corporation is the full name of CNBM, which is one of the largest state-owned groups in China, and listed in the Fortune 500 Enterprises. We are specialized in hot rolled steel, cold rolled steel, stainless steel product, steel billet etc.

Related Reading:

Want to Know Turkish Steel Prices on JAN?