Chinese hot rolled coil (HRC) export offers have risen during the past week, supported by the appreciation of the Chinese currency.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $510/mt FOB for late April delivery, up $10/mt compared to the average prices recorded last week. At the same time, limited deals have been done at $505-510/mt FOB to South Africa and Southeast Asia, supporting overall sentiments in the market. Overall demand for ex-China HRC has been limited as most buyers have been bidding at $500/mt FOB and below. “Most players in the Chinese market have left the market. Thus, offer prices will unlikely see changes in the coming two weeks,” an international trader told SteelOrbis.
The local Chinese HRC market has fluctuated within a limited range recently. Domestic HRC prices in China are at RMB 3,750-3,880/mt ($547-566/mt) ex-warehouse on January 21, with the average price level RMB 30/mt ($4.4/mt) higher as compared to January 14, according to SteelOrbis’ data.
During the given week, demand has been very slack due to the proximity of the Chinese New Year holiday. Inventory of HRC has risen in some regions of the country, while, due to limited transportation ahead of the holiday, inventory has seen declines in other regions, and so overall inventory has not recorded big rises.
As of January 21, HRC futures at the Shanghai Future Exchange are standing at RMB 3,593/mt ($523.7/mt), decreasing by RMB 3/mt ($0.44/mt) or 0.08 percent since January 14.
$1 = RMB 6.861