China's HRC production increased by 1.78% on a weekly basis

HRC production of 37 Chinese flat steel producers showed a recovery between September 2-6, reaching 3.1 million tons, up 1.78% from the previous week. This increase in production was due to steel mills in Southwest and North China resuming production after completing maintenance work.

September is traditionally the peak period for steel consumption in China, but HRC demand remains sluggish. Steel demand, which usually recovers from the slowdown in the summer months, has been slower than expected this year, causing the market to take a cautious stance.

HRC production and inventories remained high throughout the week, raising concerns about oversupply. This imbalance between supply and demand has weakened market confidence, and the majority of buyers have begun to adopt a wait-and-see policy.

As of September 5, HRC stocks at the 37 assessed mills increased for the fourth week in a row, reaching 964,500 tons.

Weak market conditions are also reflected in HRC prices. As of September 6, the spot price of Q235 4.75 mm HRC fell for seven consecutive days to CNY 3,083 (USD 433.71) per ton. This level marked a 5.05% decrease on a weekly basis and was the lowest price since November 2016.