Approaching holiday boosts flat rolled prices

SteelOrbis Shanghai In view of the upcoming National Day Holiday (on October 1-7), end users increased their stock, thus giving rise to brisk commercial activities. Meanwhile, over the past week many steel mills announced ex-factory price hikes for October. These two reasons have directly boosted market prices. Since the rebound of flat rolled in August, traders and mills have been very cautious about the future because of the sharp increase experienced so far. Nevertheless, since the Q4 is the hot season for steel demand, market prices are expected to go up if production can maintain the current stable growth rate. The domestic market prices of cold rolled and hot rolled products generally saw increases throughout last week: On September 25, average price quotation of 5.75 mm x 1,500 mm SS400 hot rolled coil in Tianjin, Shanghai and Lecong increased RMB 70/mt ($9) week on week to RMB 3,813/mt ($482), that of 2.75 mm x 1,250 mm Q235B hot rolled coil was down RMB 13/mt ($2) to RMB 4,127/mt ($522). The average price of 2.0 mm x 1,250 mm 08YU imported cold rolled coil remained constant at RMB 4,200/mt ($528). The average price of 1.0 mm x 1,250 mm x 2,500 mm ST12 cold rolled sheet is up RMB 40/mt ($5) at RMB 4,857/mt ($614), and that of 1.0 mm x 1,250 mm ST12 cold rolled coil is up RMB 30/mt ($4) at RMB 4,723/mt ($597). The average price of imported 0.6 mm x 1,250 mm 08YU cold rolled coil is up RMB 50/mt ($6) at RMB 5,150/mt ($651). Regarding the hot rolled market, prices in China continued to climb up over the past week. Traders in the eastern China market were active in making purchases since they expected that Shagang would hike ex-factory prices significantly. This resulted in a considerable market price increase. Furthermore, the growth in demand and the rapid decline in inventory also boosted the traders' confidence. The market in southern China remained basically unchanged following the soaring prices of the previous week. In northern China, with the increased inventory, traders were quite cautious about the market, and so prices did not see much change. However, driven by the brisk Shanghai market, both northern and southern markets increased slightly on Monday, September 25. Regarding the cold rolled market, its good performance was maintained over the past week. A remarkable characteristic of the recent price increase was that, in spite of the small increase range for products from Anshan New Steel, Benxi Steel, and Wuhan Steel, products from those medium-sized mills such as Maanshan Steel, Tangshan Steel, and Handan Steel saw a continuous rise, indicating that market is gaining in strength.