During the past week China's domestic pre-painted galvanized iron prices continued their rising trend. For example, the price of CGCC 0.476 mm x 1,000 mm x C material produced by Wuxi NewDaZhong has increased to RMB 5,130/mt, up from RMB 5,080/mt last Friday.
This week domestic PPGI prices have continued to climb up despite the downward movement in the HR market. PPGI inventories are still shrinking with the result that the transaction situation is better than for other products. However, as HR prices have begun to decrease, the increase trend in the PPGI market may soon come to an end. The downstream side is maintaining a wait-and-see stance in expectation of lower purchasing costs and is very cautious about buying at current price levels. With most traders now worrying that a price decrease may be around the corner, they are seeking to avoid any buildup of inventories. Overall, the domestic PPGI market in China is still on the way up due to the low inventory situation; however, this upward trend may not last for long more.
As for domestic mills, Bensteel this week issued its ex-works prices for June, keeping its PPGI prices unchanged from May levels. Thus, its price of 0.47 mm TDC51D still stands at RMB 4,850/mt ($710/mt). Tianjin Xinyu this week raised its PPGI ex-works prices by RMB 250/mt ($36/mt). With domestic market prices continuing at high levels for the time being, more and more mills are thought likely to increase their PPGI ex-works prices.
Based on the situation observed this week, the upward movement in China's domestic PPGI market may continue into next week. However, with the downward price movement seen for some major steel products, PPGI prices are expected to follow a similar trend soon.