Ex-China hot dip galvanized (HDG) offer prices have moved on a downtrend, while local HDG prices have also seen decreases. Bad demand is expected to keep impacting prices, but lower supply is likely to limit price declines to some extent.
Offers from mills this week are at $710/mt FOB for late December shipment, down by $20/mt compared to October 13 on average. Reference deal prices for ex-China HDG have been heard at $680-690/mt FOB, but trading has been limited.
“The continuously decreasing HRC futures prices have exerted a negative impact on market players’ sentiments, while supply shortage has provided some support for the HDG market,” an international trader said.
During the given week, HDG prices in the Chinese domestic market have moved down amid decreasing HRC futures prices and prevailing cautious sentiments among market players. Meanwhile, other flat steel product prices have also moved down, also negatively affecting the HDG market. However, the supply shortage of HDG has bolstered prices. It is expected that HDG prices in the Chinese domestic market will continue their fluctuating trend in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have decreased by RMB 40/mt ($5.6/mt) compared to October 13 to RMB 4,820/mt ($677/mt) ex-warehouse, according to SteelOrbis’ information.
As of October 20, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,612/mt (507.3/mt), decreasing by RMB 110/mt ($22/mt) or 2.96 percent since October 13.
$1 = RMB 7.1188