As consumption demand in the traditional peak "Golden September" season failed to see a notable release and a strong wait-and-see sentiment pervaded the market, domestic spot steel prices edged down slightly. Trading in the iron ore market also traded weaker, with ore prices dipping marginally amid overall stability.

Over the past week, the composite index of domestic spot steel prices closed at 154.6 points, dropping 0.71% week-on-week. Driven by a sharp slump in steel billet prices at the end of the previous week, merchants softened their quoted prices at the start of the week. The downward price trend amplified wait-and-see sentiment among end-users, resulting in sluggish market trading. In the latter half of the week, steel futures plunged rapidly, pulling spot steel prices lower as well. Nevertheless, spot prices posted far milder declines than futures, as merchants faced limited overall sales pressure and major steel mills continued to prop up prices.

Prices of construction steel slipped modestly. Week-on-week tonnage prices fell by RMB 10 to RMB 100 in cities including Shanghai, Hangzhou and Jinan. Market confidence has been dampened to a certain extent, leaving merchants eager to offload inventories. At present, steel mills are seeing rising output and inventories, leading to an ample supply of steel products in the market. Meanwhile, peak-season demand in "Golden September" has fallen short of expectations, inevitably pushing the steel market into a pattern of weak fluctuations.

Plate prices declined across the board. Hot-rolled coil prices posted relatively steeper falls, with tonnage prices dropping RMB 20 to RMB 170 week-on-week in Shanghai, Hangzhou, Guangzhou and other regions. Overall market demand remains weak, with trading volumes contracting slightly. Some merchants are reluctant to sell at excessively low prices amid moderate inventory levels and cost constraints. Medium and heavy plate prices fluctuated downward, with tonnage prices slipping RMB 10 to RMB 100 week-on-week in Shanghai, the Beijing-Tianjin-Hebei region and Shenyang. Trading activity has visibly weakened, with no signs of a short-term surge in downstream demand.

The iron ore market weakened slightly amid stable overall conditions. In the domestic iron ore market, prices of iron fine powder in Hebei Province remained largely steady, with normal purchasing activity from steel mills. Imported iron ore prices rose first and then fell. As of the 14th, the Platts index for 62% iron ore stood at USD 74 per tonne, down USD 0.15 week-on-week. Heightened market expectations of environmental production curbs for steel mills in the fourth quarter have gradually intensified downward pressure on iron ore. Many steel mills built up substantial inventories earlier and have shifted to a wait-and-see stance recently, dragging down trading volumes.

Relevant institutional analysis points out that social inventories of steel products keep climbing at present, while expectations of improved peak-season demand have yet to materialize. Market attention has shifted to subdued demand, amplifying downward pressure on steel prices.

Editor: Song Yucheng

Source: Xinhua News Agency