During the first half of the past week (April 15-22), the Chinese cold rolled market continued its declining trend of the previous week. However, as of April 16, cold rolled prices in the leading markets such as Tianjin, Shanghai and Lecong started to move up from the bottom level. Since then, sales activity has started to show some recovery as compared with the previous week, though strong market inventory levels still exert great pressure.
Product name |
Specification |
Category |
Average price(RMB/mt) |
Weekly change (RMB/mt) |
Price ($/mt) |
1.0 mm x 1,250 x C |
SPCC |
4,000 |
+63 |
586 |
|
CRS |
1.0 mm x 1,250 x 2500 |
SPCC |
4,107 |
+80 |
601 |
The main reason for the continuing downtrend in China's cold rolled market in the first half of last week was the high inventory level caused by the ongoing arrivals of cold rolled materials. At present, surplus supplies are observed in the cold rolled market, apart from thick plate of which supplies are relatively scarce. In addition, the arrivals of low-priced materials have constituted an additional threat to China's cold rolled market. During the second half of the past week, prices started to rebound, mainly due to the fact that prices had almost declined to cost levels. In addition, the overhaul projects of the mills, the fall of arrivals in the northern market and the uptrend of hot rolled prices have all combined to encourage traders to make tentative increases to prices.
On the whole, the increase in the second half of the past week has provided some relief for the slackening market. However, given the high inventory levels, it is hard to talk about a real rebound in the near future. Based on the newly-issued statistics, in the first quarter of 2009 China's economy has indicated signals of a revival, and a more positive performance is expected in the second quarter. Traditionally, the second quarter is a strong season, and so prices are likely to break away from the prolonged downtrend and to rebound. In the short term, however, the Chinese cold rolled market is expected to show stable movement.
On April 17, domestic steelmaker Anshan Steel announced a RMB 250/mt ($37/mt) decrease for May production cold rolled products. In line with this adjustment, ST12 1.0 mm CRC offers from the company are now at RMB 3,320/mt ($486/mt), excluding VAT. Although this decrease is smaller compared to last month, the producer's offers are now basically at the same level as the current mainstream quotations in the Chinese domestic market.