Ex-China HRC offer prices have moved up sharply this week amid surging HRC futures prices and iron ore prices, while demand continues to come from foreign customers. HRC prices in the Chinese domestic market have indicated big rises, which also support export prices.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $610-635/mt FOB for February shipment, moving up by $22.5/mt on average compared to December 1. The latest deal reference price for SS400 HRC has reached $600-605/mt FOB, which is $15-20/mt higher than $585/mt FOB a week ago. This level corresponds to the current bids in the Asian market, in countries such as Vietnam and Pakistan.
A deal for ex-China SAE1006 HRC was heard at $635-643/mt CFR Vietnam ($625-633/mt FOB) late last week, up from the previous transactions at $627-630/mt CFR earlier last week and up by more than $20/mt week on week. Also, a fresh booking for SAE1006 HRC has been reported from China to Pakistan at $650/mt CFR, which translates to $630-635/mt FOB. The continuing visible shortage of re-rolling grade HRC in Asia has supported bigger rises in SAE1006 HRC prices compared to prices for SS400.
“The surging iron ore prices and increasing HRC futures prices have exerted a positive impact on market players’ sentiments in the export market,” an international trader told SteelOrbis.
During the given week, HRC prices in the local market in China have also posted sharp increases. Meanwhile, inventory of HRC is at relatively low levels, bolstering prices. Domestic HRC prices in China are at RMB 4,340-4,390/mt ($608-628/mt) ex-warehouse on December 8, with the average price level RMB 200/mt ($31/mt) higher as compared to December 1, according to SteelOrbis’ data.
As of December 8, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,313/mt ($660.5/mt), increasing by RMB 135/mt ($21/mt) or 3.23 percent since December 1.
$1 = RMB 6.532
