Over the past week the Chinese hot rolled market has continued to climb up on a fluctuating trend. Meanwhile, many mills have announced upward adjustments to their HRC prices. For instance, Baosteel issued unchanged prices compared to its November levels, but with discounts canceled; meanwhile, WISCO hiked its HRC prices by RMB 300/mt.
Product name |
Specification |
Category |
Average price (RMB/mt) |
Weekly change (RMB/mt) |
Price ($/mt) |
HR |
5.75 mm x 1,500 mm |
Q235B |
3,697 |
+44 |
542 |
HR |
2.75 mm x 1,250 mm |
Q235B |
3,843 |
+43 |
564 |
Looking at the current situation, in the context of rising market inventory levels, end-side demand has continued to remain relatively low compared with previous years, with the majority of deals in the market being concluded between traders. Most hot rolled traders have realized that the speed of recovery of end-side demand is still far below the growth rate of market inventory; however, given the Chinese government's loose monetary policy, most traders have sufficient supplies of capital and have not been under much pressure in recent times.
Hot rolled inventory in China's leading markets has showed a mixed performance in the various regions in the past week, with overall inventory indicating an uptrend. According to the latest figures, total hot rolled inventory in China's leading markets stands at 3.89806 million mt, up 80,900 mt week on week and up 153 percent year on year. Moreover, hot rolled inventory in Shanghai amounted to 1.33089 million mt on November 12, up 26,340 mt compared with the level on November 5.
On November 11, Chinese steel giant Baosteel announced its ex-factory prices for flat steel products for delivery in the month of December. While hot rolled prices have remained at November levels, the discount for Q235 HRC has been canceled, while there is a reduced discount of RMB 200/mt ($29/mt) for SPHC products. As a result, the price of 5.5 mm x 1,500 mm x C SS400 is now at RMB 3,642/mt ($534/mt), while that of 2.75 mm x 1,250 mm x C SPHC stands at RMB 4,042/mt ($593/mt).
Meanwhile, also on November 11, Hubei Province-based steelmaker Wuhan Iron and Steel Corporation (WISCO) released its ex-factory prices of some flat steel products for December delivery. Hot rolled prices have increased by RMB 300/mt ($44/mt). After the adjustment, the price of 2.75 mm x 1,250 mm Q235 HRC is at RMB 3,850/mt ($565/mt), while the price of 5.5 mm x 1,500 mm Q235 HRC is at RMB 3,690/mt ($541/mt).
As regards other mills, on November 10, Jinan Steel, Laiwu Steel, and Liuzhou Steel successively hiked their HRC prices by RMB 30/mt, RMB 80/mt, and RMB 80/mt, with their 5.75 mm Q235 HRC now offered at RMB 3,630/mt, RMB 3,530/mt, and RMB 4,090/mt respectively.
Excepting the prices of Baosteel and WISCO, all the other prices include 17 percent VAT. ($1 = RMB 6.82)
Overall, hot rolled prices in China have continued to move up on a fluctuating trend over the past week. Meanwhile, China's leading mills have hiked their ex-factory prices of hot rolled coils, thereby helping to boost market confidence to a certain extent. As regards the immediate future, China's domestic hot rolled prices are expected to retain their mild upward movement in a context of relatively stable demand and sufficient capital supply.