Ex-China hot dip galvanized (HDG) offer prices have increased slightly this week given the continuous support from the recovery of HRC futures prices. However, no significant support has been seen from the demand side and so, according to sources, trade has remained slow, with most buyers asking for additional discounts.
Offers from mills this week are at $705-715/mt FOB for late September shipment, moving up by $5/mt as compared to June 29. At the same time, reference deal prices for ex-China HDG have been heard at $675-705/mt, FOB, versus $665-695/mt FOB last week.
“The increasing HRC futures prices have exerted a positive impact on HDG offer prices, though the slack demand has weakened the support for the HDG market,” an international trader said.
During the given week, HDG prices in the Chinese domestic market have moved up amid relatively low production capacity utilization rates and increasing HRC futures prices. The widespread hot weather in China has negatively affected the demand for HDG from downstream users. Market players have started to be cautious as regards the future prospects for the HDG market. It is thought that HDG prices in the Chinese domestic market will likely move on a fluctuating trend within a limited range in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have gained RMB 40/mt ($5.6/mt) compared to June 29, standing at RMB 4,660/mt ($647/mt) ex-warehouse, according to SteelOrbis’ information.
As of July 6, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,860/mt (536/mt), rising by RMB 45/mt ($6.25/mt) or 1.2 percent since June 29.
$1 = RMB 7.2098