During the past week China's domestic pre-painted galvanized iron prices continued their downward trend but at a slower rate. For example, the price of CGCC 0.476 mm x 1,000 mm x C material produced by Wuxi NewDaZhong has now dropped to RMB 5,070/mt, down from RMB 5,100/mt last Friday.
Due to high inventories and weak demand, China's domestic PPGI prices have continued to drop, but at a slower rate. Traders are still pessimistic due to the poor transaction situation, as purchasers continue to wait for even lower prices. Thus, the price decline trend has engendered a vicious circle. Meanwhile, the downstream industries which use PPGI have not yet started to show a recovery.
As for China's import and export markets for PPGI, both import and export volumes for this product have recently indicated an increase. According to the latest customs data, China's color coated plate and strip exports in February amounted to 129,697.609 mt, up 15.25 percent from the January level. On the other hand, imports of color coated plate and strip in February came to 31,122.599 mt, up 39.21 percent from January. The Chinese authorities have stated that the export rebate rate on certain steel products will be raised as of April 1. It is rumored that the rebate rate for PPGI will be increased to 17 percent; however, precise details are still being awaited.
Based on the situation observed this week, China's domestic PPGI market is still on a downward track though at reduced speed. After the rebate rates are declared next week, the downward trend may finally level off. We will have to wait and see...