With a certain release of downstream demand seen in some regions, China's domestic medium plate market moved steadily up during the past week.
Product name | Specification | Category | Average price (RMB/mt) | Weekly change (RMB/mt) | Price ($/mt) | Weekly change ($/mt) |
Common carbon medium plate | 20 mm | Q235 | 3,793 | +136 | 555 | +20 |
Low alloy medium plate | 20 mm | Q345 | 3,980 | +175 | 583 | +26 |
16 mm | CCS A/B | 4,010 | +67 | 587 | +10 |
Over the past week medium plate prices in various regions in China climbed up slightly day by day. With local HRC prices about RMB 200/mt ($29/mt) higher than local plate prices, the domestic medium plate market has been basically following the uptrend of the HRC market in recent days. Due to the high levels of HRC prices, slab prices are generally expected to rise in the near future, with more hot rolled coils expected to be produced instead of medium plate. In this event, the market supply of medium plate is likely to go down, eventually pushing up medium plate prices in the future.
In Lecong, with market prices on the rise, downstream demand began to register a certain release in the past week, indicating the gradual acceptance of the increased prices by end-users. Currently, given the support of the hiked ex-factory prices from leading mills, most players seem cautiously optimistic as regards the future trend. Generally speaking, with medium plate inventory in Lecong at relatively low levels, the local market is in a fairly healthy condition.
Turning to the Shanghai market, players here are also bullish as regards the future despite the smaller price increase recorded in Shanghai compared with that in Lecong. Many traders are convinced that the sufficient capital supply will help boost market trading. On account of the greater availability of credit in the first half of this year, many observers anticipate a possible increase in inflation for the second half of the year, which would also lead to a rise in steel prices. In addition, as a result of the relatively high ex-factory prices from the mills, the costs of future arrivals are expected to grow increasingly higher; meanwhile, many traders are preparing to stockpile so as to maximize their gains.
According to the latest statistics, China's medium plate production in June totaled 5.0612 million mt, down 274,000 mt or 5.14 percent year on year. Average daily production during the month reached 168,700 mt, up by 5,500 mt or 3.36 percent month on month. Meanwhile, Chinese medium plate production for the January-June period reached 27.5908 million mt, down 3.4986 million mt or 11.25 percent year on year.