China Materials_ 2025 On-ground Demand Monitor Series #12 – Steel Inventory and Consumption Data Tracker

Summary of the Conference Call on China Materials - Steel Industry Industry Overview - The report focuses on the China Materials sector, specifically the steel industry and its demand trends in China as of February 2025 [1][7]. Key Points and Arguments 1. Demand Recovery Expectations: Market expectations regarding demand recovery in the steel sector remain cautious, with a revised near-term pecking order established as Steel, Cement, Coal, Gold, Copper, Aluminum, and Lithium [1][7]. 2. Steel Production Data: - Total steel production in China from January 31 to February 6 was 8.1 million tons (mt), reflecting a 0.2% week-over-week (WoW) increase and a 0.6% year-over-year (YoY) increase. - Year-to-date steel production totaled 48.9 mt, down 4.8% YoY [2]. - Breakdown of production: - Rebar: 1.8 mt (+3.5% WoW, -4.3% YoY) - Hot-Rolled Coil (HRC): 3.2 mt (+0.2% WoW, +2.7% YoY) - Cold-Rolled Coil (CRC): 0.8 mt (-1.7% WoW, +2.7% YoY) [2]. 3. Steel Inventory Levels: - As of February 6, total steel inventory was 16.7 mt, up 6.4% WoW but down 6.0% YoY. - Inventory breakdown: - Steel mills: 5.2 mt (+4.7% WoW, +2.3% YoY) - Traders: 11.5 mt (+7.2% WoW, -9.4% YoY) [2]. 4. Apparent Consumption: - For the week of January 31 to February 6, apparent consumption was 7.1 mt, a significant 44.6% WoW increase and 20.7% YoY increase. - Year-to-date apparent consumption was 43.3 mt, down 16.4% YoY [2]. - Breakdown of apparent consumption: - Rebar: 1.3 mt (16x WoW, -91.6% YoY) - HRC: 3.0 mt (+10% WoW, +11.8% YoY) - CRC: 0.8 mt (+34.1% WoW, -0.3% YoY) [2]. Additional Important Insights - The report emphasizes the importance of monitoring high-frequency demand trends to identify potential investment opportunities and risks within the steel sector [1][7]. - The data indicates a mixed performance across different steel products, with rebar showing significant volatility in apparent consumption [2]. - The overall cautious sentiment in the market suggests that investors should remain selective and consider broader economic indicators when evaluating investment opportunities in the materials sector [1][7].