The shedding in the domestic levels continued in week 12 after a peremptory hike in interest rates by the Chinese government by 50 basis points. The blind quest to rein inflation has taken its toll on the nascent revival in the market after the Tsunami in Japan.

Just after the calamity in Japan the Chinese market which had been languishing since New Year sparkled in anticipation of demand for reconstruction in Japan.

However mandarins remained steadfast sticking to the avowed policy of reining inflation. A brutal hike in 50 basis points in lending rate although expected could have been delayed giving time to the fledgling market to gain momentum.

But on the weekend, the domestic steel prices in China showed the first glimmer of revival. After the flash of post Tsunami anticipated demand had fizzled out owing to rather ill timed hike in lending rates by 50 basis points by the People’s Bank of China despair was revived.

With the revival of domestic price levels on weekend it heralded the first signs of realistic redemption. Plethora of factors giving an aura of positivism is as follows

1. Expected demand from the Japan for reconstruction
2. Ameliorated supply to SE Asian markets after curtailed supply from Japan
3. Opening of demand from infrastructure and housing sector as the season picks up
4. Stock depletion, as it is reported that on 18th March, domestic steel inventory totalled 18.0916 million tonnes, down 0.52 million tonnes, or 2.83% WoW.

The revival devoid of any speculative tenor might be realistic and durable. However a lot will depend on the galvanizing of demand from construction, auto and white good sector to give a sense of direction to the rudderless market.

On the whole, the Chinese Long Product Price Index CLPPI continued in downward trends with 42 points last week whereas the Chinese Flat Products Index CFPPI also dropped by 32 points. The overall price index CHISPI declined by 36 points.

CLPPI - Chinese Long Product Price Index
CFPPI - Chinese Flat Product Price Index
CHISPI - Chinese Steel Price Index

Long Products

PI - Product Index

Flat Products

PI - Product Index

To know more about these indices please visit
http://steelprices-china.com/spi_services/spi.html

1. Long products

Billets
150*150
Q235

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

WRC
6.5mm
Common

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

Rebars
20mm
HRB 400

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

Angle
#5

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

Channel
#16

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

Beam
#25

Change is on Mar 25th as compared to 18th Mar 2011
Change is per tonne

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