Ex-China HDG offers have edged up slightly over the past week amid the rising freight costs caused by the ongoing war in the Middle East.
Specifically, offers from large Chinese mills stand at $615-625/mt FOB for May shipment, up $5/mt compared to March 19, while offer prices from smaller mills have been heard at $595-610/mt FOB, versus $595-605/mt FOB last week.
As a result, the SteelOrbis reference price for ex-China Z120 HDG stands at $595-625/mt FOB, versus $595-620/mt FOB recorded on March 19.
During the given period, HDG prices in the Chinese domestic market have seen slight rises amid increasing HRC futures prices. However, market players have mostly held a wait-and-see stance as regards the future prospects for the HDG market due to relatively high inventories. Demand for HDG from downstream users has improved, but is not as good as market players had expected, which has weakened the support for prices. Inventory consumption has been slow, also exerting a negative impact on the HDG market. Some traders said they have chosen to sell, even at lower prices, aiming to reduce inventories. It is expected that HDG prices in the Chinese domestic market will move sideways in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have gained RMB 3/mt ($0.4/mt) compared to March 19, standing at RMB 4,023/mt ($583/mt) ex-warehouse, according to SteelOrbis’ information.
As of March 26, HRC futures at Shanghai Futures Exchange are standing at RMB 3,305/mt ($478.5/mt), increasing by RMB 3/mt ($0.4/mt) or 0.09 percent since March 19, while decreasing by 0.45 percent compared to the previous trading day, March 25.
$1 = RMB 6.9056
