Demand for ex-China CRC has remained weak over the past week even after the sharp price cuts seen last week. Most customers are cautious in their purchases, seeing a drop in the local Chinese market, and waiting for a further decline. Moreover, concerns regarding the introduction of export tax from January still exist.
At present, export offers for CRC given by major Chinese mills are at $925-935/mt FOB for January shipment, with the average prices remaining stable compared to November 3.
“Following the big declines in ex-China CRC offer prices, market players have been seeking to hold their prices stable, though rare transaction activities have been heard,” an international trader told SteelOrbis. The tradable level has been below $920/mt FOB, sources have said. Seeing sharp drops in the HRC segment, buyers are confident that CRC prices have space to go down further.
During the given week, local CRC prices in China have seen sharp decreases amid the continuous declining trend in ferrous metal futures prices and the prevailing bearish sentiments. The demand for CRC has remained slack, while downstream users have been cautious in concluding purchases. It is expected that CRC prices may fluctuate within a limited range at current low levels.
Average domestic 1.0 mm cold rolled coil spot prices in China are at RMB 5,563/mt ($870/mt) ex-warehouse, moving down by RMB 363/mt ($57/mt) compared to November 3, according to SteelOrbis’ information.
As of November 10, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,463/mt ($698/mt), decreasing by RMB 319/mt ($50/mt) or 6.7 percent since November 3.
$1 = RMB 6.3948