Some Chinese mills have attempted to increase their hot dip galvanized (HDG) export offer prices, following big rises in HRC futures prices in China early this week and a slight improvement in sentiments. However, the latest offers from smaller mills and some deals have been at lower levels, as mills have been struggling to sell and have had to attract buyers.
Specifically, offers from large mills are heard at around $625-630/mt FOB for October shipment, versus $615/mt FOB last week. However, smaller mills are still offering lower prices, trying to accelerate sales. A few offers for Z80 HDG have been heard at $555-565/mt FOB, which is equivalent to $570-580/mt FOB. Small-volume deals were done at this range, but in general sales are very weak, according to market sources.
As a result, the SteelOrbis reference price for ex-China Z120 HDG has settled at $570-625/mt FOB, versus $600-615/mt FOB last week.
During the given week, HDG prices in the Chinese domestic market have seen further declines, though they may see a rebounding trend in the coming period amid support from increasing HRC futures prices and improved sentiments. Currently, HDG prices have hit their lowest levels of the past five years, so market players have expected prices to bottom up. Transaction activities have improved to a certain degree, though low-priced supplies receive a greater welcome from buyers. It is expected that HDG prices in the Chinese domestic market will likely edge up in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have lost RMB 63/mt ($8.8/mt) compared to August 15, standing at RMB 3,937/mt ($553/mt) ex-warehouse, according to SteelOrbis’ information.
As of August 22, HRC futures at Shanghai Futures Exchange are standing at RMB 3,247/mt ($456/mt), increasing by RMB 25/mt ($36.3/mt) or 0.8 percent since August 15, while down 0.55 percent compared to the previous trading day, August 21.
$1 = RMB 7.1228
