Ex-China HDG offer prices are currently at $580-590/mt FOB, down $2.5/mt on average due to slight decreases on the high-end week on week against the backdrop of the New Year holiday, while buyers have been bidding at $580/mt FOB.
During the given week, inventories of HDG in the Chinese domestic market have been at comparatively low levels, though demand from downstream users has slackened. Average 1.0 mm SGCC hot dip galvanized spot prices in China have lost RMB 4/mt week on week to RMB 4,716/mt ($677.4/mt) ex-warehouse, according to SteelOrbis’ information.
On January 1, the People's Bank of China (PBC) announced a lowering of the required reserve ratio for financial institutions by 0.5 percentage points effective as of January 6, 2020 (excluding finance companies, financial leasing companies and auto finance companies), which will release around RMB 800.0 billion ($115.0 billion) and bolster HDG prices ahead of the Chinese New Year holiday.
As of January 2, HRC futures at the Shanghai Future Exchange are standing at RMB 3,571/mt ($513.0/mt), increasing by RMB 14/mt ($2.0/mt) or 0.4 percent since December 26.
$1 = RMB 6.9614
