Bad weather plus higher zinc price equals to stable GI price in China

SteelOrbis Shanghai This week, the market price of galvanized iron maintained its stable trend, while the trading volume and market inventory levels did not change. China's galvanized iron exports decreased in October according to latest statistical data, and some mills announced unchanged new ex-factory prices. On November 30, the average market price of 1.0 mm galvanized coil was RMB 5,650/mt ($721), down RMB 7/mt ($1) compared with last week; that of 0.5 mm galvanized coil is RMB 5,890/mt ($754), down RMB 27/mt ($3) compared with the price last weekend; while the average market price of 0.23 mm galvanized coils imported from Indian Bhushan company is unchanged at RMB 7,200/mt ($913). This week, though the market price of some thin galvanized coils declined slightly, with the steadiness of the HR market price, the market price of galvanized coil were stable on the whole. The trading volume and market inventory levels of galvanized coil remained unchanged. This week, the bad weather conditions continued, and no turn for the better was seen in the market demand for galvanized coil either. Though the market price of HR began to show signs of improvement, traders were not optimistic about the future market because of the long-standing low market demand. This week, following the example of Baosteel's steady 2007 Q1 ex-factory prices, several other big steel mills in China, including Panzhihua Steel, Baotou Steel and Handan Steel remained unchanged. Meanwhile, the market inventories of GI were still at a low level, and so there is little possibility of the GI market price declining greatly. On the other hand, the Zinc price in the domestic market began to increase - useful information as regards the stability of the GI market price - up RMB 1,000/mt ($128) week on week at RMB 36,000/mt ($4,592) this week. Also this week, the Chinese authorities released the October data for steel industry imports and exports. According to the new figures, the October import of galvanized iron was 316,000 metric tons, down 5,200 metric tons compared with September. The October export of galvanized iron was 316,300 metric tons, down 8,900 metric tons compared with September. Thus, the net export of galvanized iron in October was 300 metric tons.