The Chinese cold rolled coil (CRC) market has continued to follow a decreasing trend in the past week. The transaction volume has been on the weak side, while a pessimistic atmosphere has gained ground in the market.
Product name | Specification | Category | Average price (RMB/mt) | Weekly change (RMB/mt) | Price ($/mt) |
1.0 mm × 1,250 mm × C | SPCC | 5,033 | -134 | 742 | |
CRS | 1.0 mm × 1,250 mm × 2,500 mm | SPCC | 5,367 | -100 | 792 |
At present, in the Shanghai, Tianjin and Lecong markets, the prices of ST12 1.0 mm × 1,250 mm × C CRC respectively stand at RMB 4,850/mt ($715/mt), RMB 5,150/mt ($760/mt) and RMB 5,100/mt ($752/mt), while the respective prices of ST12 1.0 mm × 1,250 mm × 2,500 mm cold plate respectively stand at RMB 5,250/mt ($774/mt), RMB 5,250/mt ($774/mt) and RMB 5,600/mt ($826/mt). All prices are ex-mill and include 17 percent VAT (US$1 = RMB 6.78).
During the past week, HRC prices in the main Chinese cities dropped below RMB 4,000/mt ($591/mt), leading to increased pessimism about the prospects for the CRC market. Some traders continue to sell off products at reduced prices, but demand has remained poor, even weaker than before, especially as regards auto plate and top-end plate. CRC orders from automakers and household appliance enterprises have fallen strongly. Some automakers and household appliance producers report a strong buildup of unsold automotive vehicles and household appliances which were produced in March and April. As a result, demand from such producers for CRC is likely to remain weak in the coming period.
In the past week, aggregate CRC inventory in the main Chinese cities saw a slight decrease, totaling 1,362,230 mt on July 2, down 4,930 mt week on week. On July 2, CRC inventory in the Shanghai market amounted to 456,030 mt, down 4,730 mt from the previous week.
The decrease in inventory is caused by smaller volumes of new arrivals and also by the selling off of inventory by traders. As regards exports, at present mainstream quotations of ex-China 1.0 mm CRC are in the range of $660-670/mt (FOB), though the actual transaction volume at this price is not great. Chinese mills and foreign trading companies currently tend to give quotations in line with specific cases.
Generally speaking, no improvements have been observed as regards inventory pressure and weak demand. Next week, Baosteell will issue its prices for August production. Because its July ex-mill prices are higher than the spot market prices, it is thought that Baosteel may lower its August production prices. It is expected that in the coming week the Chinese domestic CRC market will continue its downward trend.