Ex-China HRC offer prices have edged up slightly this week amid the price rises in the local market and relatively low inventories. Only small volumes can be sold abroad as most customers assess current prices as being too high.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $475-490/mt FOB for late September shipment, moving up by $7.5/mt on average compared to last week following the sharply rising trend seen in the previous week.
It is heard that some small tonnages of ex-China HRC were sold at $490-495/mt CFR to Pakistan, of which 3,000 mt were booked at the higher end of the range last Friday.
Ex-China prices have not been workable in Southeast Asia as customers from Vietnam have been able to buy domestic coils at $460-465/mt CFR and offers from India have been at $465-475/mt CFR after a recent increase.
In the import HRC segment in China, the latest deal has been done from the leading Vietnamese seller for 30,000 mt of SEA1006 coils at $470/mt CFR China, according to sources. The offer level is at $475/mt CFR China at the moment.
“Firm local prices have bolstered ex-China HRC prices and import activities have pushed up sellers’ offer prices for HRC in the international market,” a trader told SteelOrbis.
Traders’ costs of booking HRC from steelmakers in the local market in China have increased, bolstering their offer prices. Meanwhile, HRC inventory has been relatively low, exerting a positive impact on prices. Domestic HRC prices in China are at RMB 3,840-3,900/mt ($550-558/mt) ex-warehouse on July 21, with the average price level RMB 5/mt ($0.7/mt) higher as compared to July 14, according to SteelOrbis’ data.
As of July 21, HRC futures at the Shanghai Futures Exchange are standing at RMB 3,787/mt ($542/mt), increasing by RMB 31/mt ($18.1/mt) or 0.83 percent since July 14. The improvement in futures prices was mostly due to the increase of RMB 40/mt seen today, July 21. It has bolstered spot activity in the local market to some extent.
$1 = RMB 6.9862
