Ex-China hot dip galvanized (HDG) offer prices have edged up in the past week, following a stable trend in the previous week. Offers are at $555-570/mt FOB for late September delivery this week, increasing by $7.5/mt on average compared to week one ago amid the rising trend in local HDG prices and increasing iron ore prices. At the same time, deal prices have been heard at $555/mt FOB for small volumes to South America, $5/mt higher compared to the previous week.
“Demand for HDG in the local market has been good, and so steelmakers have not come under strong pressure to export and will be unwilling to cut export prices,” one trader said.
During the given week, the high levels of iron ore prices have bolstered HDG prices. Meanwhile, Chinese steelmakers raised their ex-works prices for HDG: for instance, Xinjiang Uygur Autonomous Region-based Bayi Iron and Steel has increased its HDG prices by RMB 50/mt ($7/mt) as of July 9, following which traders also increased their offer prices for HDG. At the same time, HDG inventories have been at relatively low levels, also exerting a positive impact on HDG prices. It is thought that HDG prices in the Chinese market will move sideways in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have edged up by RMB 63/mt ($9/mt) week on week at RMB 4,556/mt ($651/mt) ex-warehouse, according to SteelOrbis’ information.
As of July 9, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,718/mt ($531/mt), increasing by RMB 155/mt ($22.1/mt) or 4.4 percent since July 2.
$1 = RMB 7.0085
