China Steel Industry Association said today that currently China’s steel inventories and prices increase simultaneously. However this situation is unstable and difficult to maintain.
According to statistics from China Steel Industry Association on one hand that China steel prices continue to rise since 2010. Price index rose to 125.71 points on April 16th, rising by 19.31 points compared with the beginning of this year. Among this long products rose by 20.7% and plate rose by 16.15%.
The reason of such rise is mainly because of cost rise especially the significant price rise of iron ore and coking coal in the international market. On the other hand, after investigations of social inventories of five varieties in 20 Chinese major cities statistics show that China’s social inventories of steel is rising. Back to early 2009, this was at a low level and after constantly inventories replenishing it was back to normal level. However, at the end of March 2010, the social inventories have risen by 34.43% compared to that of early 2009.
China Steel Industry Association said that inventories increasing with prices are partly because of the price rising expectation as well as the high growth of domestic demand. Thus this situation could not be maintained for a long time.