Issue 50, 2024 - This week's editorial: Sentiment boosts markets, fundamentals remain shaky

More economic policy meetings in China, you say? Yes, last week saw the Politburo meeting and Central Economic Work Conference take place in the world’s largest steel market. Although again failing to deliver concrete steel demand growth measures, China did loosen its monetary policy for the first time in 14 years, spurring hopes of growth measures next year. This fuelled some optimism in global markets, seeing Turkish scrap import prices gain almost $10/tonne last week as mills firmly returned to the market. The fall of Bashar al Assad immediately shifted the market’s focus to future steel-intensive reconstruction in Syria, further boosting Turkish rebar market sentiment. Global fundamentals remained shaky, however, and all expectations of an uptrend were therefore tempered. 

Major damage caused by a cargo ship to a lock in the Moselle River in Germany meanwhile posed the risk of scrap supply disruption and elevated prices. Finally, India officially defined green steel – and raised some eyebrows in the process.

Chinese domestic HRC and rebar prices rose CNY 40/t ($5) and CNY 30/t ($4) respectively in the week to last Friday, boosted by policy announcements. However, HRC inventories increased, while rebar purchases slowed due to reduced construction activity amid rains. It will still be some time before the Chinese market feels the impact of looser monetary policy.

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