In the past week, the Chinese hot rolled coil (HRC) market has fluctuated in a slight downward direction amid weak transaction activity. Average prices in the main Chinese HRC markets can be viewed in the SteelOrbis price reports section.
As many downstream customers have started to go on holiday early ahead of the Chinese Spring Festival, steel demand in the Chinese HRC market has softened further and transaction activity remains at low levels. Some traders have been selling cargoes as usual to customers with transaction prices RMB 10/mt lower than offer prices, though the overall transaction volume is weak. However, most traders with low inventories and under no pressure from shortages of funds have shown little interest in concluding deals.
As for the steel mills, the steel prices issued by major domestic producers Baosteel and WISCO for February shipments have mostly remained unchanged month on month. Accordingly, it appears that the mills are cautious as regards the market outlook for the post-holiday period.
After completing transactions this week, many trading companies will stop business before the Spring Festival holiday. Summing up, it is expected that the Chinese HRC market will enter a phase of stagnation with little price change in the coming period.