Ex-China hot dip galvanized (HDG) offer prices have edged up further in the past week, following an uptrend in the previous week, though overall sentiment has eased lately after the decline in HRC prices and futures prices in China.
Offers for HDG from mills are at $630-650/mt FOB for late November delivery this week, up by $7.5/mt on average compared to one week ago amid the limited supply for the export market. Deal prices have been heard at $630/mt FOB to South America, moving up by $5/mt on average compared to the tradable value last week.
Though HRC prices in the local market have indicated big declines in the given week, demand for HDG from downstream automakers has been steady, which has provided support for local HDG prices. “The downtrend in HRC prices has negatively affected market players’ sentiments, which may exert a negative impact the HDG market in the near future,” an international trader said.
During the given week, overall demand for HDG has been moderate as downstream users in China have been cautious at the current high levels of prices. Meanwhile, inventory of HDG has been at relatively low, bolstering prices to some extent. Average 1.0 mm SGCC hot dip galvanized spot prices in China have risen by RMB 3/mt ($0.47/mt) week on week to RMB 4,863/mt ($712/mt) ex-warehouse, according to SteelOrbis’ information.
As of September 10, HRC futures prices at the Shanghai Futures Exchange are standing at RMB 3,732/mt ($546/mt), decreasing by RMB 210/mt ($30.7/mt) or 5.3 percent since September 3.
$1 = RMB 6.8331