This week ex-China HRC prices have shown a slight increase given that average HRC prices in the Chinese domestic market have moved up compared to the previous week amid increasing HRC futures prices and improved market sentiments. However, Chinese HRC export trading has remained muted, with persistent market uncertainty discouraging both traders and overseas buyers.
More specifically, export offers for boron-added SS400 HRC from most large Chinese mills stand at $465-485/mt FOB, with a midpoint at $475/mt FOB, up by $10/mt week on week. “Most mills have been trying to go higher, though deal prices from mills are still estimated by most market players at $465-470/mt FOB levels,” a market insider told SteelOrbis. Offers from smaller mills have been voiced at $458-465/mt FOB, up by $3-5/mt week on week.
Meanwhile, tradable prices for ex-China SS400/Q235 HRC have settled at $455-465/mt FOB, up by $5/mt week on week. Offers for ex-China Q235 HRC 2,000 mm have been voiced at $475-480/mt CFR Vietnam, the same as at the beginning of last week, but up by $10/mt compared to offers reported at the end of last week.
At the same time, suppliers in the Middle East have reported most ex-China SS400 HRC offers at $490-495/mt CFR, the same as last week, though a deal for around 15,000 mt was signed at $480/mt CFR Oman at the end of last week. “Buyers still estimate tradable prices at $485/mt CFR and even slightly lower, despite some increase in China’s futures prices,” one source commented. Furthermore, offers for ex-Turkey Q195 HRC have been estimated at $485-490/mt CFR, mainly the same as last week.
Domestic HRC prices in China have settled at RMB 3,350-3,580/mt ($464-496/mt) ex-warehouse on May 14, with the average price level RMB 10/mt ($1.4/mt) higher compared to that recorded on May 7, according to SteelOrbis’ data.
On May 12, the US-China trade negotiations made substantial progress, causing HRC prices to move up. The US and China announced a 90-day pause on "reciprocal" tariffs starting from May 14, which will lead to the US tariffs on Chinese imports retreating from 145 percent to 30 percent, while Chinese tariffs on US imports will fall from 125 percent to 10 percent, which exerted a positive impact on market sentiments. However, as regards the prospects for the HRC market, market players have lacked confidence, resulting in difficulties in accepting high-priced HRC, while transaction activities have started to slacken.
As of May 14, HRC futures at Shanghai Futures Exchange are standing at RMB 3,267/mt ($457/mt), increasing by RMB 50/mt ($7/mt) or 1.5 percent since May 7, while up 1.27 percent compared to the previous trading day, May 13.
