Drop in GDP in Q1 at 7.7% dampened spirits in market after the recent holiday. Although bulk of Q1 was washed out but during the last couple of weeks rot had stemmed with price remaining relatively stable.

Approaching summer and the ensuing pick up in construction activity gave fillip to market sentiments recently but it could not only achieve status quo.

Double blow of drop in GDP and below par industrial output smothered enthusiasm. Mills are cutting ex-w prices, seeing the snail-paced destocking and dim demand. End users are keeping low stocks, fearing of further price retreat.

Government’s has been sticking to conservative policies to regulate market products and quality in construction steel will certainly clip the speculative flare.

Week opened with slight dip in steel price in China. However the pattern remained stable with over a week indicating some stability. Bottoming out still played hide and seek with minor fluctuations in the price.

Reportedly some major mills rolled over price from April to May on anticipated pick-up in demand in Q2. Construction activity increases during this period and with slew of infrastructure projects lined up demand growth looks inevitable.

At the same time it would be perilous to ignore the present realities. More so with the traders pressuring mills into giving discounts to cater over the financial limitations in tight market some elbow room is unavoidable.

Currently, downstream demand is turning better; yet, the spot market has been trending down since Feb, witnessing the prices drop far away from the EXW prices. Hence if mills fail to cut prices again or increase discounts, order books will be affected shortly.