Ex-China hot dip galvanized (HDG) offer prices have edged down further over the past week, following sharp drops in futures and HRC prices in the local market. Offers from mills and some traders are this week at $950-1,000/mt FOB for late January shipment, moving down by $75/mt week on week on average.
“The continuous declines in ferrous metal futures prices and the decreasing local HDG prices have negatively affected ex-China HDG offer prices,” an international trader said. Most mills are offering at the higher end of the range, but traders can provide $950-970/mt FOB, which makes the market nervous. The negative sentiment locally has pushed prices down sharply and made traders more aggressive.
During the given week, local HDG prices have indicated slight declines amid declining HRC futures prices and the prevailing bearish sentiments among market players. The demand for HDG has remained slack, which has exerted a negative impact on prices. It is expected that HDG prices may fall further amid the approaching cold weather.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have lost RMB 47/mt ($7.3/mt) week on week to RMB 6,653/mt ($1,039.5/mt) ex-warehouse, according to SteelOrbis’ information.
As of November 4, HRC futures prices at the Shanghai Future Exchange are standing at RMB 4,614/mt (721/mt), decreasing by RMB 449/mt ($70/mt) or 8.9 percent since October 28.
$1 = RMB 6.3943
