Chinese HR and CR prices keep rising

SteelOrbis Shanghai Driven by brisk commercial activity, Chinese HR and CR prices continued to go up over the past week due to the reduced levels of market inventory. On December 18, the average price quotation of SS400 grade 5.75 mm x 1,500 mm x C in Tianjin, Shanghai and Lecong was at RMB 3,723/mt ($476/mt), neutral week on week, while that of Q235B grade 2.75 mm x 1,250 mm x C was up RMB 7/mt ($1/mt) to RMB 3,917/mt ($501/mt). The average price of ST12 grade 1.0 mm x 1,250 mm x 2,500 mm was up RMB 60/mt ($8/mt) to RMB 4,817/mt ($616/mt), while that of ST12 grade 1.0 mm x 1,250 mm x C was up RMB 40/mt ($5/mt) to RMB 4,773/mt ($610/mt). As regards the situation of hot rolled, the Chinese market remained stable throughout the past week, with a normal trading volume being observed. Due to the soaring of cold rolled prices in recent days, the steel mills reduced the hot rolled supply to the market, leading to reduced market inventory levels. With regard to the Chinese cold rolled market, an upward trend in prices continued, with a sharp increase seen in Shanghai. Boosted by the hike in ex-factory prices at Lianyuan Steel, the southern China market continued to climb up. Meanwhile, northern China saw stable movement overall. Some traders indicated that demand for cold rolled products was likely to expand in the coming days, especially in the automobile and household appliance industries. Sources report that there is a great deal of HR and CR piling up at the major ports in northern China. Only a small part of these products will be exported to other countries, while most are destined to enter the domestic market. Traders in eastern and southern China are quite worried about this build-up at the ports. However, so far it would seem that the flat rolled market has not been affected much. HR and CR prices have maintained steady movement - evidence that the pressure of the mounting supplies at the ports is not great thus far. All in all, the current Chinese HR and CR prices are unlikely to drop down in the short term.