Ex-China HRC offer prices have moved sideways in the past week, still remaining high for most customers. However, it is unlikely that suppliers will cut offers much any time soon, as the recent production cuts in Jiangsu will prevent sharp price decreases in the local market in the near future.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $950-970/mt FOB for November shipment, with a midpoint at $960/mt FOB, moving sideways on average compared to last week. “The export offer prices have been quite stable for a while with very rare transaction activities,” an international trader told SteelOrbis.
The tradable price level for SS400 coils has been heard at $920-930/mt FOB lately, up by $5/mt on average form last week.
The workable price level for SAE1006 HRC from Chinese small mills and traders has been reported at $930-940/mt FOB. But most Asian suppliers have focused on negotiations with Russia and India - for Vietnam, and Japan and South Korea - for Pakistan and some other Southeast Asian countries. “We get offers at $970/mt CFR from Japan and $940/mt CFR for Korea. Chinese coils are expensive in this market,” an Indonesian source said.
During the given week, HRC prices in the Chinese domestic market have indicated declines amid the fluctuating trend of HRC futures prices at Shanghai Futures Exchange (SHFE). Bearish sentiments have prevailed among market players and some traders have sold at lower prices, aiming to stimulate transaction activities. However, since some additional production restriction measures have started to been seen in Jiangsu, supply may go down further, preventing local prices from declining further.
Domestic HRC prices in China are at RMB 5,760-5,790/mt ($896-900.5/mt) ex-warehouse on October 19, with the average price level RMB 85/mt ($13.2/mt) lower as compared to October 12, according to SteelOrbis’ data. Compared with the price level on Monday, October 11, average local quotations are RMB 5/mt ($0.8/mt) higher.
As of October 19, HRC futures at the Shanghai Futures Exchange are standing at RMB 5,736/mt ($892/mt), increasing by RMB 112/mt ($17.4/mt) or 2.0 percent since October 12.
$1 = RMB 6.4307
