Ex-China HRC offer prices from mills have moved up amid the increasing trend in local prices and HRC futures prices. Besides, despite the increases, Chinese offers have remained the most competitive in higher-priced markets like the Middle East, Turkey and even the EU. However, Chinese traders who focus on HRC sales to Asia keep their offers around $50/mt lower compared to mills’ quotes.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $880-910/mt FOB for June shipment, with a midpoint at $895/mt FOB, moving up by $37.5/mt compared to March 22. The lowest offer prices came from Shandong Province-based Chinese steelmakers Rizhao Iron and Steel and Shandong Iron and Steel, which have been heard at 880/mt FOB and $890/mt FOB respectively, while the highest prices were from Jiangsu Province-based major Chinese private steelmaker Shagang Group and Liaoning Province-based steelmaker Benxi Iron and Steel, which have been heard at $900/mt and $910/mt FOB, respectively. “Most mills are offering at $880-910/mt FOB, but some mills like Anfeng Steel and Zougheng Steel are offering at $850-860/mt FOB,” a market insider told.
The tradable level for SS400 HRC has been heard at $845-885/mt FOB, up by $15-35/mt over the past week. In particular, Chinese traders, who sold around 100,000 mt of SS400 at $868-870/mt CFR Vietnam last week, have increased their offers to around $875-880/mt CFR this week. However, only offers to Asian buyers have been reported at such low levels, while offers to higher-priced markets have been voiced at $885/mt FOB and above. In particular, ex-China SAE1006 HRC offers have been voiced in the UAE at $1,000-1,020/mt CFR (around $920-930/mt FOB). Besides, several deals for ex-China coils were reportedly closed in Turkey at $1,000-1,030/mt CFR last week, as SteelOrbis reported earlier. Furthermore, ex-China SAE1006 HRC offers have also been heard in Europe at $1,050/mt CFR and above.
Meanwhile, HRC prices in the Chinese domestic market have risen amid the declining inventory level. The worsening Covid-19 pandemic in many regions of China has negatively affected the circulation of supplies and the demand for HRC, though the supply has also been negatively affected. Notably, since last week raw materials deliveries by truck to local steelmakers in Tangshan, China's top steel production city in North China's Hebei Province, have been disrupted as the local authorities continue to wage their battle against the rising cases of Covid-19. However, according to market insiders, most companies are maintaining their blast furnace production by relying on in-house stocks of raw materials and those materials that can be delivered by rail where disruptions are few. Thus, only some local mills whose raw materials stocks had been rather low originally have gradually reduced their blast furnace operations.
Domestic HRC prices in China are at RMB 5,210-5,240/mt ($819-823/mt) ex-warehouse on March 29, with the average price level RMB 86/mt ($13.5/mt) higher as compared to March 22, according to SteelOrbis’ data.
As of March 29, HRC futures at the Shanghai Futures Exchange are standing at RMB 5,255/mt ($825.7/mt), rising by RMB 92/mt ($14.5/mt) or 1.8 percent since March 22.
$1 = RMB 6.376
