SEATTLE (Scrap Monster): Steel yesterday settled down by -3% at 43060 amid continuous concerns regarding the Chinese economy’s struggle to recover, hampering the outlook of resource demand from the world’s top steel consumer. After manufacturing PMIs and trade turnover both disappointed expectations in July, fresh data showed that new yuan loans and social financing growth were less than half of expectations in the period, furthering concerns of slow growth in China. On top of that, giant developer Country Garden issued a profit warning and risks defaulting on its debt obligations, triggering fresh concerns over the steel-intensive Chinese property sector.
The outlook of lower construction demand drove the Chinese government to significantly lower the production outlook for 2023, resulting in activity halts for key mill hubs. China's imports of iron ore in July slipped 2% from the previous month, customs data showed, as sintering curbs in major steel production hub Tangshan dampened demand for the key steelmaking ingredient. The world's largest iron ore consumer brought in 93.48 million metric tons of iron ore in July, up 2.5% from the same month a year earlier, data from the country's General Administration of Customs showed.
China's exports of steel products in July grew 9.6% from the previous year to 7.31 million metric tons, extending a decline to two consecutive months, data showed. The country shipped 50.89 million metric tons of steel products in the first seven months of the year, a 27.9% year-on-year rise, according to customs. China imported 678,000 million metric tons of steel products last month, down from 790,000 metric tons in July 2022, with the January to July total at 4.42 million metric tons, a 32.6% decline on the year.
Technically market is under long liquidation as the market has witnessed a drop in open interest by -55.75% to settle at 500 while prices are down -1330 rupees, now Steel is getting support at 42300 and below same could see a test of 41550 levels, and resistance is now likely to be seen at 44200, a move above could see prices testing 45350.
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