Ex-China cold rolled coil (CRC) prices have remained stable over the past week even though demand in the local market has been very weak. Rather tight supply has supported CRC prices, but some small room for declines still exists, market sources believe.
More specifically, ex-China CRC offer prices from mills are at $545-550/mt FOB this week, moving sideways on average week on week, while the tradable levels for ex-China CRC have been heard at $535-540/mt FOB, for shipment in September.
During the given week, CRC prices in the Chinese domestic market have indicated slight declines amid the ongoing sluggish demand from downstream users. On August 1, Jiangsu Province-based Shagang Group, has cut its offer prices for 5.75 mm x 1,500 mm Q235B HRC by RMB 150/mt ($22/mt) to RMB 3,550/mt ($523/mt) ex-works, for delivery in August, exerting a negative impact on market sentiments. Currently, the widespread high temperatures have negatively affected the demand for CRC. Meanwhile, HRC futures prices have moved on a downtrend, slackening market sentiments and weakening the support for CRC prices. Typhoon Dolphin is going to hit coastal areas in China, which will dampen the demand for CRC further. However, supply of CRC in some regions has been tight, which may help bolster prices. It is thought that CRC prices in the Chinese domestic market will soften slightly in the coming week.
Average domestic 1.0 mm cold rolled coil spot prices in China are at RMB 3,613/mt ($532/mt) ex-warehouse, decreasing by RMB 17/mt ($2.5/mt) week on week, according to SteelOrbis' information.
As of August 5, HRC futures at Shanghai Futures Exchange are standing at RMB 3,207/mt ($472/mt), decreasing by RMB 79/mt ($11.6/mt) or 2.4 percent since July 29, while rising by 0.31 percent compared to the previous trading day, August 4.
$1 = RMB 6.7889
