SunSirs: The Procurement Was Mainly Based on Demand, and the Galvanized Sheet Market Was Still Weaker

Price trend                               

This week, the price trend of galvanized steel coils had shown some differentiation. State owned galvanized steel coil prices continued to decline to promote transactions, while private galvanized steel coil prices had slightly increased with the rise of futures, but overall shipments had not made much difference. According to the Commodity Market Analysis System of SunSirs, the prices of galvanized steel coils in China have remained stable this week. As of September 20th, the average market price of galvanized steel coils in China was 4,052.50 RMB/ton, a decrease of 0.06% compared to the previous week.

Analysis review

Fundamentals: After the three-day holiday in mid autumn, market inventory continued to increase, and spot market operations were still mainly focused on reducing inventory through shipment. The market shipment situation was not optimistic, and the demand for "Golden September" had slightly released, but compared to the same period in previous years, it is relatively bleak. The National Day holiday is approaching, and the market sales cycle is only one week. However, based on this year's holiday stocking, downstream procurement is still mainly focused on essential needs.

According to the latest data obtained by SunSirs, the overall production rate of galvanized sheet this week was 82.31%; The capacity utilization rate was 57.79%, an increase of 0.79% from last week; The weekly output was 824,200 tons, an increase of 11,300 tons from last week. The inventory of steel mills was 511,600 tons, a decrease of 3,400 tons from last week.

Downstream: China Iron and Steel Association: In August 2024, key statistics showed that steel companies produced a total of 64.63 million tons of crude steel, a year-on-year decrease of 8.0%, with a daily output of 2.0849 million tons, a month on month decrease of 5.4%.

Market outlook

After the Mid Autumn Festival, the market shipment volume has not changed much compared with that before the festival, and downstream customers still mainly purchase goods on demand. The longer National Day holiday indirectly leads to a shorter sales cycle in October. In order to reduce the shipping pressure in October, it is not ruled out that merchants may lower prices and ship in September in advance. SunSirs expects that galvanized steels and coils will continue to maintain a weaker trend in the short term.

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