Galvanized coil price increase softened this week

SteelOrbis Shanghai Although galvanized coil prices continued increasing this week, the growth range has shrunk greatly. The trading volume kept unchanged compared with last week and the market inventories increased slightly. Some mills increased their ex-factory prices. Galvanized coil prices increased around RMB 27-57/mt ($3-7) week on week varying according to thicknesses. The shrinkage in the range of increase was mainly because of a slight increase in market inventories while the trading volume kept unchanged. Furthermore, Chinese government's value-added tax refund reduction for exports will reportedly be announced in the last ten days of June, to be effective from July 1. The news has influenced steel manufacturers and traders by a large scale. Meanwhile, global zinc price has dropped by a wide margin in June; from $3,700/mt on June 3 to $3,040/mt in June 16 according to London Metal Exchange. In China, the market price of domestic “Torch” brand 0# zinc decreased by RMB 3,000/mt ($375) to RMB 30,000/mt ($3,750) compared with last week. The decrease of the zinc price curbed galvanized coil price increases. The decline in the market prices of hot rolled products this week has also put a pressure on galvanized coil market prices. Despite the aforesaid developments, however, Baotou Steel increased its galvanized coil ex-factory prices RMB 300/mt ($37) and Masteel increased RMB 280/mt ($62) this week.