Chinese steel futures continued to trends upwards further on Thursday. Steel market inventories continued to decline, but at a slower pace, with HRC inventories now essentially flat, Kallanish notes.

On the Shanghai Futures Exchange the October rebar contract closed at CNY 3,807/tonne ($595/t), CNY 31/t higher than Wednesday, while the same contract for hot rolled coil closed up CNY 25/t at CNY 3,943/t. In Tangshan, billet prices gained CNY 20/t to CNY 3,700/t.

Overall steel inventories continue to decline but there are signs the trend is bottoming out, and HRC inventories saw their first increase of the season this week. Total HRC inventories were up 0.1% week-on-week to 2.93 million tonnes, driven by a 1.4% increase in mill inventories to 958,400t, according to a count by SMM. This was still -25.8% down from the previous year however.

Rebar meanwhile saw inventories decline but the pace slowed and inventories are now up from a year previously. Overall rebar inventories were down -3.43% w-o-w to 7.04mt, which was 3.77% higher than a year earlier. Both trader and mill inventories were down over the week.