Chinese plate prices unlikely to decline

SteelOrbis Shanghai Chinese plate traders have turned to western markets for exports as local plate prices in China remain higher than export prices to Southeast Asia, while the local market kept stable throughout last week. After the adjustment in steel mills' ex-factory prices, the plate market is now in a stable trend with minor fluctuations only in low alloy plate prices. In early last week, market was weak and saw slight downward trend, therefore, traders were very prudent. However, as the Labor Holiday is approaching, some traders hiked their prices by a small range considering the upcoming stockpiling activities. On the import and export side, it's not easy to export products to Southeast Asia, as the current local price level is high. Therefore, many importers and exporters turn to the European and American markets. The purchase offers from Middle East are on the rise due to the tight availability there. At present, China's offers for medium plate export to Middle East are at $560-630/mt CFR, depending on the specification. Sources report that offers for S355 medium plate exports to France are at Euro 650/mt CFR. The tight availability still continues in local markets. Especially in Tianjin, Tianjin Steel did not deliver any products until Thursday, April 20. Therefore, traders indicated that they stopped forward transactions for 10-20 cm thick plate products of Tianjin Steel as products from steel mills have not arrived and the supply is tight. Although some small scale traders quoted low prices for certain products in the beginning of the week, the strong demand returned the prices to their previous levels in the rest of the week. Shanghai and Lecong markets did see significant changes. Medium plate prices are unlikely to see declines in the short term mainly because: 1. There are not many new batches of products arriving in those three leading markets, 2. The medium plate inventory is at a low level, and 3. The May Day is approaching.