Ex-China hot dip galvanized (HDG) offer prices have moved up further in the past week, following a slight uptrend in the previous week. Offers from Chinese mills are at $570-585/mt FOB for October shipment this week, increasing by $12.5/mt on average compared to one week ago amid the increasing trend in local HDG prices and rising raw material prices. An offer at $600/mt FOB was also heard from a northern steelmaker, though it has failed to attract deals at that high level.
At the same time, deal prices have been heard at $570-575/mt FOB to South America and Southeast Asia, $10-15/mt higher than in the previous week.
“Steelmakers have increased their export offer prices for HDG amid high iron ore prices and rising local HDG prices,” one trader said.
During the given week, steelmakers’ production costs have increased due to rising raw material prices, while HDG supply to the spot market has decreased, resulting in steelmakers’ willingness to increase their offer prices. At the same time, bullish sentiment has prevailed among HDG market players due to rising futures prices. It is thought that HDG prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have edged up by RMB 27/mt ($3.9/mt) week on week to RMB 4,633/mt ($663/mt) ex-warehouse, according to SteelOrbis’ information.
As of July 23, HRC futures prices at the Shanghai Futures Exchange are standing at RMB 3,840/mt ($533.6/mt), increasing by RMB 105/mt ($15/mt) or 2.8 percent since July 16.
$1 = RMB 6.9921