Ex-China cold rolled coil (CRC) prices have moved sideways over the past week with slightly better trading activity seen, but the future price trend will depend strongly on production plans in August.
More specifically, ex-China CRC offer prices from big and medium mills are at $545-550/mt FOB this week, remaining stable on average week on week, while the tradable levels are at $535-540/mt FOB, for shipment in September. A few deals have been reported at $540/mt FOB base for the Americas market, but lower levels at around $535/mt FOB have been widely available in the MENA region.
During the given week, CRC prices in the Chinese domestic market have indicated slight decreases amid relatively low transaction activities. Production of CRC has been at relatively high levels, while no plans for centralized maintenance works have been heard from steelmakers. “If steelmakers don't strictly implement maintenance works in August, there will be further declines for finished steel prices,” a market source said, reflecting a widespread view, indicating that the market situation is fairly grim. Some CRC producers are only earning small margins, hovering near break-even point.
The approaching Politburo meeting in China has provided some support for market sentiments. It is thought that CRC prices in the Chinese domestic market will likely continue their weak consolidation and fluctuate within a limited range in the coming week.
Average domestic 1.0 mm cold rolled coil spot prices in China are at RMB 3,630/mt ($535/mt) ex-warehouse, decreasing by RMB 17/mt ($2.5/mt) week on week, according to SteelOrbis' information.
As of July 29, HRC futures at Shanghai Futures Exchange are standing at RMB 3,286/mt ($483/mt), increasing by RMB 4/mt ($0.6/mt) or 0.1 percent since July 22, while rising by 0.15 percent compared to the previous trading day, July 28.
$1 = RMB 6.7899
