Ex-China hot dip galvanized (HDG) prices have inched up, following rises in local HDG prices. But taking into account fall in futures and HRC prices, the outlook is not very positive in the HDG segment too.
Offers from mills this week are at $730/mt FOB for late December shipment, remaining stable compared to September 29 on average. Reference deal prices for ex-China HDG have been heard at $690-700/mt FOB, up by $2.5/mt compared to pre-holiday period.
“Market players concluded purchases for HDG following the long holiday, positively affecting local HDG market, while downtrend in HRC futures prices may weaken the sentiments,” an international trader said.
During the given week, HDG prices in the Chinese domestic market increased amid the improved transaction activities and the prevailing bullish sentiments among market players following the long National Day holiday. Meanwhile, steelmakers have been willing to keep their ex-works prices for HDG at higher levels, for instance, Chinese major steelmakers, Baosteel, Liaoning province-based Anshan Iron and Steel and Liaoning province-based Benxi Iron and Steel held their HDG prices stable for November. However, HRC futures prices moved down, which may exert a negative impact on the HDG market. It is expected that HDG prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have increased by RMB 157/mt ($22.1/mt) compared to September 29 to RMB 4,860/mt ($683.5/mt) ex-warehouse, according to SteelOrbis’ information.
As of October 13, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,722/mt (523.5/mt), decreasing by RMB 156/mt ($22/mt) or 4.0 percent since September 29.
$1 = RMB 7.1101