Chinese hot rolled coil (HRC) export offers have edged down slightly, but are still not competitive against the backdrop of the sharp declines in crude oil prices in the international market and severe competition from overseas sellers.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $415-425/mt FOB for late June delivery, down by $2.5/mt on average versus $415-430/mt FOB late last week. At the same time, bids from overseas buyers have been heard at $400-405/mt FOB from customers in Asia and South America. Importers in Pakistan have been in negotiations at $410-420/mt CFR, but no deals have been reported so far.,
At the same time, a number of HRC cargoes from India have been sold at $395-405/mt CFR Vietnam with the most recent trade at $400/mt CFR. A deal for Russian coils has been closed at $388/mt CFR Vietnam. Offer prices from Japan have been heard at $420/mt CFR Vietnam and at least two deals have been closed at $410-420/mt CFR.
While export trading remains weak, there have still been negotiations for imported material in China. “Chinese buyers have been interested in low-priced import HRC,” an international trader told SteelOrbis. A contract for ex-India HRC has been rumored at about $390/mt CFR China. But this information has not been confirmed by the time of publication.
HRC futures prices at Shanghai Futures Exchange (SHFE) edged up at the beginning of the given week, but moved down later due to the worsening situation in the global market, i.e., the sharp decreases in crude oil prices and the rapid spread of the coronavirus pandemic. Pessimistic sentiments prevail among market players.
Domestic HRC prices in China are at RMB 3,300-3,320/mt ($466.4-469.2/mt) ex-warehouse on April 21, with the average price level RMB 20/mt ($2.8/mt) lower as compared to April 14, according to SteelOrbis’ data.
As of April 21, HRC futures at the Shanghai Future Exchange are standing at RMB 3,185/mt ($450.1/mt), decreasing by RMB 15/mt ($2.1/mt) or 0.5 percent since April 14.
$1 = RMB 7.0752
