Ex-China HRC offer prices have edged down slightly in the past week, following the declines seen in the local spot market and falling futures prices. At the same time, due to overall negative sentiments in most sales destinations, trading has been weak, but may improve in January.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $770-790/mt FOB for February shipment, with a midpoint at $780/mt FOB, edging down by $10/mt compared to December 21. “HRC futures prices have moved down, weakening the support for local HRC and export offers,” an international trader told SteelOrbis.
The tradable price level for SS400 coils has been heard at $760/mt FOB lately, down also by $10/mt on average over the past week, but trading has been very weak. Asian customers still see space for ex-China prices to go down, especially after some deals were concluded for ex-India coils at much lower levels. Buyers from South America have been taking a wait-and-see stance due to the holiday period.
During the given week, HRC prices in the Chinese domestic market have inevitably decreased amid the declining trend of HRC futures prices in China. A spell of very cold weather has hit China, exerting a negative impact on demand for HRC, which has resulted in a wait-and-see stance among market players. Also, there are some expectations for production increases in January as some mills will normalize work after repairs. It is thought that HRC prices in the Chinese domestic market will fluctuate within a limited range in the coming week.
Domestic HRC prices in China are at RMB 4,680-4,850/mt ($735-761/mt) ex-warehouse on December 28, with the average price level RMB 90/mt ($7.1/mt) lower as compared to December 21, according to SteelOrbis’ data. Compared with the price level on Monday, December 27, average local quotations are RMB 10/mt ($1.6/mt) lower.
As of December 28, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,442/mt ($697/mt), decreasing by RMB 157/mt ($24.6/mt) or 3.4 percent since December 21.
$1 = RMB 6.3728
