Ex-China HRC offer prices have edged down slightly amid sufficient overseas supplies in the export market, which has resulted in stronger competition. Also, the gradual softening of domestic prices in China have pushed some traders to sell short at lower levels.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $510-530/mt FOB, moving down by $2.5/mt on average compared to last week following the uptrend seen in the previous week. There have been reports about short sales by traders for SS400 coils at $505-510/mt FOB recently, mainly in Asia. At the same time, mills have been refusing to go below $510-515/mt FOB.
Last week, sources from Pakistan have reported deals for ex-China SS400 HRC at $528-531/mt CFR, which is equivalent to around $513-515/mt FOB, SteelOrbis has learned.
In Vietnam, 10,000 mt of Chinese SAE1006 have been traded at $530/mt CFR from one of the major mills, after contracts at $520-525/mt CFR. At the same time, 50,000 mt in total of ex-CIS HRC was traded at $510/mt CFR Vietnam a week ago. Moreover, more competitive ex-India HRC offers have started to emerge in the market at $535/mt CFR on average.
During the given week, HRC prices in the Chinese local market have edged down, while demand has been slack following the stock replenishment after the holiday. Inventory of HRC has risen slightly, weakening the support for HRC prices. Domestic HRC prices in China are at RMB 3,850-3,900/mt ($575-583/mt) ex-warehouse on October 20, with the average price level RMB 45/mt ($6.7/mt) lower as compared to October 13, according to SteelOrbis’ data.
As of October 20, HRC futures at the Shanghai Futures Exchange are standing at RMB 3,745/mt ($559.5/mt), decreasing by RMB 39/mt ($5.8/mt) or 1.0 percent since October 13.
$1 = RMB 6.693
