Issue 35, 2024 - This week's editorial: Chinese rebound elicits caution, thyssenkrupp descends into chaos

Meteorological summer came to an end last week but the steel market remained hot amid a tangible rebound in China, management chaos at one of Europe’s largest steelmakers and demand rebound anticipation in Europe following the conclusion of the summer break.

Chinese prices extended their rally started the week prior, with the KORE 62% Fe iron ore index hitting $101.65/tonne cfr China on 29 August, the highest in three weeks. The strength came on the back of increased expectations that the US Federal Reserve will cut interest rates in September, as well as two-week high Chinese steel futures prices and much improved rebar market sentiment.

The momentum also lifted Chinese hot rolled coil prices, although not to the same extent as rebar. Inventories declined, but this was supported by reduced production. As is always the case, however, Chinese mills became more reluctant to stick with production cuts as the price environment improved.

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