Hot and cold rolled prices may rise despite weak trade

SteelOrbis Shanghai Experiencing a sharp price rise after the Labor Day, Chinese HRC prices have witnessed minor upward trend with fluctuations over last week, while cold rolled prices have remained unchanged on the whole. The HRC prices have increased to a level that both traders and steelmakers can earn profits. But the price increase fails to keep momentum; therefore, the business activity is not favorable. Nevertheless, with the announcements of agreements between various mills and Brazilian CVRD, market players began thinking that China would also accept a similar increase. As a result, prices are getting more stable and even going up. At the same time, Baosteel increased its third quarter prices in accordance with the market expectations. On the import and export side, the announcement of the new export tax rebate policy is expected, but it currently does not have any significant influence on the domestic market. Sources report that Benxi Steel hiked its export offers to $560/mt FOB for HR and $680/mt FOB for CR, but its domestic prices have remained unchanged. The domestic market will face the same pressures with the export market. In short, HRC prices may decline after hitting the summit. Nevertheless, cold rolled prices will remain stable.