SteelOrbis Shanghai
Chinese flat rolled market prices continued the sharp decrease also last week. HR prices have been in a temporary stable trend since July 14 with the continuous decline in CR prices.
Chinese HR sheet and coil export quotations for S.
Korea have dropped since the beginning of July. HR sheet and coil quotations from Chinese steel mills to S.
Korea are currently around $545-550/mt CFR, down from $560-565/mt CFR in July. HR sheet and coil offers are expected to drop further because there are not many deals concluded.
In domestic hot rolled product market, the average price quotation of 5.75 mm x 1,500 mm SS400 hot rolled coil in Tianjin, Shanghai and Lecong was down RMB 203/mt ($25), that of 2.75 mm x 1,250 mm Q235B was down RMB 250/mt ($31), and that of imported 2.0 mm x 1,250 mm 08YU hot rolled coil was down RMB 150/mt ($19).
Some traders and end-users began to purchase some products since July 14 when hot rolled thick coil (thickness > 5.5 mm) reached RMB 3,500/mt ($438), easing trader's earlier panic. Under these circumstances, traders began to hike their hot rolled product quotations and the market became stable. Even a slight rebound has been observed in Shanghai and Lecong recently. However, market players are still prudent because there is no evident recovery in downstream demand. In addition, the leading steel mills have not recently announced any price policy to support the traders.
According to the statistics,
China produced 5.7307 million mt hot rolled sheet and coil in June, up 43.36 year on year. The total hot rolled
production from January to June reached 30.1685 million mt, up 28.5 percent year on year.
On the cold rolled side, the average price of 1.0 mm x 1,250 mm x 2,500 mm ST12 cold rolled sheet was down RMB 183/mt ($23); that of 1.0 mm x 1,250 mm ST12 cold rolled coil was down RMB 183/mt ($23), and that of imported 0.6 mm x 1,250 mm 08YU cold rolled coil was down RMB 117/mt ($15) week on week on July 17.
The cold rolled prices continued the downward trend throughout last week. With the rapid decline in cold rolled market, the CR prices of some steel mills even approached to
HRC prices. For example Tangshan Steel's 1.0 mm x 1,250 mm cold rolled coil price was RMB 4,300/mt, and Handan Steel's 1.0 mm x 1,250 mm cold rolled coil price was RMB 4.400/mt. With the increasingly evident conflict between the CR
production growth and the demand decrease of the downstream industries, the price decline is expected to continue longer.
According to the statistics, the total cold rolled
production of
China was 2.1645 million mt in June, up 58.62 percent year on year. The total cold rolled
production from January to June was 11.3523 million mt, up 45.61 percent year on year.
The future trend of flat rolled market is blurred. The factors such as the upcoming steel export tax rebate policy, the influence of macro-control on the demand of downstream industry, the impact of international steel trade frictions such as AD investigations on Chinese steel exports, the policies of domestic steel mills against the supply and demand conflict remain to be seen.
Market players are not optimistic about the future of flat rolled market trend. Without the influence of any important good or bad news on the steel market in the short term, the flat rolled prices are expected to see slight fluctuations and decline next week.