Steel social inventory will peak and fall in March

In February, the Spring Festival factors combined with shrinking demand, steel social inventory showed a continuous upward trend. As of February 19, the social inventory of steel in 29 key cities was 15.936 million tons, up 72.6% month on month and down 17.4% year on year. Among them, the social inventory of building materials was 10.878 million tons, increased by 110.2% month on month and decreased by 19.2% year on year; the social inventory of steel sheets was 5.058 million tons, increased by 24.6% month on month and decreased by 13.4% year on year.

In 2018-2019, the social inventory of steel products basically reached the peak inventory 3-4 weeks after the Spring Festival. In 2020, due to the impact of the epidemic, the smooth flow of goods and the resumption of downstream production reached the peak inventory 7 weeks after the Spring Festival. The Spring Festival this year is later than last year, and the climate conditions are favorable for construction after the festival. In addition, the pace of resumption of work after the festival is significantly accelerated. It is expected that the peak value of steel social inventory will be reached in mid March this year. When the peak value is reached, the destocking cycle will be started.