Following a decline in the ex-China hot rolled coil (HRC) offer prices last week, the downtrend has continued to gain momentum. Moreover, bearish sentiments have continued to gain ground on the back of the continued decline in futures prices in China this week.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $860-880/mt FOB for January shipment, with a midpoint at $870/mt FOB, moving down by $70/mt compared to the prices recorded on October 26. “The continuous declining trend in HRC futures prices has exerted a negative impact on local HRC prices and dragged down ex-China HRC offer prices,” an international trader told SteelOrbis.
Following the continued downtrend, ex-China HRC has started to attract some buying interest in export destinations. Specifically, in the beginning of the current week, a cargo of ex-China SS400 HRC is said to have changed hands at $915-920/mt CFR Pakistan.
Lately, the tradable price level for SS400 coils has reached $840-850/mt FOB.
During the given week, HRC futures prices continued their sharp declining trend, weakening market players’ confidence in the prospects for the future market and dragging down local HRC prices. The demand for HRC has remained slack as downstream users have only purchased to meet their urgent needs.
Domestic HRC prices in China are at RMB 5,000-5,110/mt ($781-798/mt) ex-warehouse on November 2, with the average price level RMB 490/mt ($76.6/mt) lower as compared to October 26, according to SteelOrbis’ data. Compared with the price level on Monday, November 1, average local quotations are RMB 225/mt ($35.2/mt) lower.
As of November 2, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,601/mt ($719/mt), decreasing by RMB 635/mt ($99.2/mt) or 12.1 percent since October 26.
$1 = RMB 6.4009
