During the week ending May 23, the Chinese cold rolled coil (CRC) market has continued its downward trend of the previous week. Average CRC prices in the main Chinese cities can be viewed in the SteelOrbis price reports section.
In the past week, activity in the Chinese CRC market has been only moderate. The ongoing decreases in CRC prices in the spot market have caused domestic steel mills to lower their CRC prices, thereby reducing cost support in the market. For example, Ansteel's prices of CR products for June production remained stable compared with May levels, but the steelmaker is offering discounts of up to RMB 200/mt ($31/mt) based on previous orders in order to boost orders in the coming month. Meanwhile, Shougang has cut its CRC prices by RMB 130/mt ($20/mt) and will offer some discounts to long-term customers.
At the same time, influenced by the decline in spot prices, the mills are close to incurring losses on their CRC sales. In addition, overall CRC output in China in April indicated a seven percent year-on-year increase, which means that oversupply still remains a problem. It seems that CRC prices in China have not hit bottom yet.
It is thought that Chinese CRC prices may indicate a further decrease in the coming seven days.