As time goes on, the market participants have expressed pessimistic outlooks towards the traditional peak season in September due to the soft market demand.
Firstly, China's steelmakers have encountered formidable challenges considering of the constant rising raw materials and comparatively soft demand. According to the data released by CISA, China's crude steel output has reached 1.964 million t in early September, rising by 3.1% as compared to late August. Thus China's oversupplied steel industry may deteriorate in future.
Secondly, the steel price may slip further in late September. According to the feedbacks, traders are pressurized by tight fund problems and lots of them have to cut their prices just for attracting more deals. Consequently, the price for HRC has dipped to 4700 yuan per t and this trend may continue in the short run.
Thirdly, it is reported that the European sovereign debt problems may exacerbate further in the short run, which has influenced the global market substantially. Besides, the ZEW indexes have hit the record low and this trend may continue in September. All the above factors have wobbled the market confidence and the market participants are currently holding an attitude of wait-and-see.
Fourthly, there are affirmative signs reflecting China's economy has slowed down. According to the data released by NBS, the social electricity consumption reached 434.3 billion kilowatt hours in August, which had dropped drastically as compared to the same period of last year. Besides, China's industrial added value had decreased by 0.5 percent in August from July.
To sum up, the gloomy global market situations have affected China's steel industry enormously. And the market prospect may undergo more uncertainties in late September.