Following a recovery in futures prices this week together with improved domestic quotes, Chinese HRC mills have decided to increase their export offers. Meanwhile, although some traders have increased their offers as well, most buyers have been holding back from new purchases, bidding at lower levels.
More specifically, export offers for boron-added SS400 HRC from large Chinese mills have settled at $540-550/mt FOB, with a midpoint at $545/mt FOB, up by $2.5/mt week on week. “Most mills are offering at not higher than $550/mt FOB: in particular, Shagang at $545/mt FOB, Shougang at $550/mt FOB, Baotou at $535/mt FOB, Rizhao at $545/mt FOB, and only Benxi Steel is officially offering at $570/mt FOB, but their tradable price is also at $545/mt FOB” a market insider told SteelOrbis. “We heard an ex-Benxi offer at $545/mt FOB to India this week, but it has been rejected so far,” an Indian trader said, adding, “Benxi is trying to keep offers high for India, as they are the only one with BIS certification.
Meanwhile, the tradable level for ex-China SS400 has been estimated at $517-535/mt FOB, up by $7-10/mt week on week. Ex-China offers in Vietnam have been voiced at around $530-535/mt CFR, which translates to around $517-523/mt FOB, and reflects an increase by at least $10-15/mt over the past week. At the same time, ex-China offers to the Middle East have been estimated at $530-535/mt FOB, or $570-575/mt CFR, up by around $10/mt over the past week.
At the same time, average HRC prices in the Chinese domestic market have moved up amid improved sentiments due to China’s issuance of additional special bonds worth RMB 1 trillion for 2023 in the October-December period this year. Specifically, domestic HRC prices in China are at RMB 3,950-4,060/mt ($550-565/mt) ex-warehouse on October 31, with the average price level RMB 103/mt ($14.3/mt) higher compared to October 24, according to SteelOrbis’ data.
During the given week, market sentiments have improved as China has announced that it will issue additional special bonds worth RMB 1 trillion for 2023 in the October-December period. Demand for HRC has improved to a certain degree, bolstering prices. Moreover, market players believe HRC prices may edge up in the future, also providing some support for prices. At the same time, HRC futures prices have indicated an uptrend, exerting a positive impact on prices in the spot market. In addition, the increasing iron ore prices have also positively affected HRC prices from the cost side. Thus, it is expected that HRC prices in the Chinese domestic market will edge up further in the coming week.
As of October 31, HRC futures at the Shanghai Futures Exchange are standing at RMB 3,849/mt ($523/mt), increasing by RMB 95/mt ($13.2/mt) or up by 2.5 percent since October 24, but down by RMB 7/mt ($0.96/mt) since yesterday.
Product |
Spec |
Quality |
City |
Origin |
Price(RMB/mt) |
W-o-w change |
5.75mm*1500*C |
Q235B/SS400 |
Shanghai |
Angang |
3,970 |
+100 |
|
Tianjin |
Baotou Steel |
3,950 |
+80 |
|||
Lecong |
Liuzhou Steel |
4,060 |
+130 |
|||
Avg |
|
3,993 |
+103 |
|||
2.75mm*1250*C |
Q235B |
Shanghai |
Angang |
4,080 |
+100 |
|
Tianjin |
Baotou Steel |
4,010 |
+80 |
|||
Lecong |
Angang |
4,140 |
+130 |
|||
Avg |
|
4,076 |
+103 |
$1 = RMB 7.1779