During the week ending May 21, hot rolled coil (HRC) prices in the Chinese domestic market have moved down slightly. Average HRC prices in the local Chinese market can be viewed in the SteelOrbis price reports section.
In anticipation of further decreases in domestic HRC prices, local traders have been adopting a wait-and-see stance. On May 20, Liaoning Province-based Ansteel announced a reduction of RMB 160/mt ($25/mt) in its HRC offers. Meanwhile, other HRC producers have also made downward corrections to their offers.
Traders state that at present end-user demand is still weak, while steel mills have not yet implemented any substantial measures to reduce production. However, other traders have commented that current spot market inventories are somewhat lower compared to the same time last year and that prices are already very low, without much room for further decreases.
In view of high domestic crude steel output and slack demand, steel prices in China are unlikely to recover in the short term. It is expected that in the coming week Chinese domestic HRC prices will continue to trend down.