During the past week, the Chinese HRC market has followed a declining trend. End-user demand has not shown any obvious increase, and buyers are purchasing just enough in order to meet their needs. Traders have been refilling their stocks to a certain degree, while the general transaction situation is average. As for the future market, traders have diverse expectations.
Product name | Specification | Category | Average price (RMB/mt) | Weekly change (RMB/mt) | Price ($/mt) |
HR | 5.75 mm x 1,500 mm | Q235B | 4,527 | -56 | 664 |
HR | 2.75 mm x 1,250 mm | Q235B | 4,660 | -43 | 683 |
In the Shanghai market, influenced by cost prices at steelmakers, some traders expect to see an upward trend in future market prices; however, due to factors influencing liquidity, many traders are worried about the future outlook for the market. This diversity in expectation has created some disorder as regards market quotations. There have been limited arrivals of new supplies in the Lecong market and some traders' quotations remain high, thereby providing support for market prices in Lecong. Some small amounts of supplies have arrived in the Tianjin market, mostly 3.0 mm thin plate, while 5.75 mm and other common specifications are comparatively in short supply, thus reducing the price gap between thin and thick plates.
On May 7, HRC inventory in the Shanghai market stood at 1,702,080 mt, down 36,500 mt week on week.
In the past week, increases and decreases have been seen in Chinese steelmakers' HRC price adjustments. Shagang Group, Liuzhou Steel (Group) Corporation and Rizhao Steel increased their HRC prices by RMB 200/mt ($29/mt), RMB 20/mt ($3/mt) and RMB 100/mt ($15/mt) respectively, with the present Q235 5.75 mm ex-mill prices of Shagang Group, Liuzhou Steel (Group) Corporation and Rizhao Steel at RMB 4,800/mt ($704/mt), RMB 5,390/mt ($790/mt) and RMB 4,613/mt ($676/mt) respectively. Meanwhile, Xinyu Iron and Steel's HRC price decreased by RMB 150/mt ($22/mt), with its current Q235 5.75 mm HRC ex-mill price at RMB 4,550/mt ($667/mt).
The mainstream export HRC quotation from is $680-700/mt FOB, This range is almost the same as in the previous two weeks; however, due to reduced acceptance and lack of stability in domestic HRC prices, the HRC export quotations of some Chinese traders indicate a subtle downward trend.
Generally speaking, traders in China's HRC market are not as confident as before. There is a strong wait-and-see mood in the market, and most traders are not optimistic about the future trend. Additionally, May and June are considered to constitute a low season. It is expected that the Chinese HRC market will trend sideways in the coming week.