Chinese medium plate prices climbing steadily

SteelOrbis Shanghai Although the Chinese medium plate market has begun to rise strongly following a long period of fluctuation, traders remain cautious about the current situation and are reluctant to take risks. Particularly due to capital issues, many traders are insisting on advance payment prior to shipment. On the imports and exports side, Chinese heavy plate quotations to South Korea for October and early November shipments stand at $490/mt CFR. Meanwhile, medium plate quotations for exports to South East Asia are at $500/mt CFR, with quotations for shipbuilding plates to Singapore currently at $560/mt CFR. In the domestic market as of September 12, the average price of 16 mm Q235 B in Shanghai, Tianjin and Lecong had increased RMB 40/mt ($5) week on week to RMB 3,663 /mt ($461) and that of 16 mm Q345 B had increased RMB 25/mt ($3) to RMB 3,785/mt ($476). Unlike the previous situation when the market was driven up by the steel mills' prices and by cost pressure resulting in sluggish commercial activity, during week 36 the trading volume saw a remarkable increase in the various regional markets, indicating that the prices have received strong approval from the trading companies. Furthermore, end-user demand has also increased. The upcoming National Day Holiday (October 1) and the current traditionally brisk season for sales (September – October) are both playing a significant role in the brisk commercial activity. We see that the products showing strong prices are mainly those with specifications between 12-20 mm, while the prices for heavy plate above 30 mm are almost flat. According to the present inventory structure from various major traders, almost all of them are stocking plates between 12-20 mm. Yet they still do not have significant quantities of this product. Meanwhile the heavy plate supply from the mills is increasing. Traders are saying that if the commercial activity continues to improve, then prices will see slight rises. The low inventory of medium plate makes it possible for prices to increase further. However, heavy plate prices are expected to remain stable.