Ex-China HRC prices have edged up over the past week, driven by rises in the local market and higher futures prices. But after the decreases in futures on Friday and uncertainties over local demand in China for the coming month, further upward movement is doubtful, according to sources.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $800-820/mt FOB for January shipment, with a midpoint at $810/mt FOB, moving up by $15/mt compared to November 23. “The rebounding HRC futures prices have bolstered market players’ sentiments and positively affected HRC prices,” an international trader told SteelOrbis.
The tradable price level for SS400 coils for mills has been heard at $800/mt FOB lately and for traders at $770-780/mt FOB. For the latter, the price level is stable from last week. One source said that it is possible to sell some SS400 HRC to Vietnam for January-February shipment at $760/mt FOB, but no new deals have been reported for now. This price is assessed as workable for traders selling in short position.
The workable price level for SAE1006 HRC from Chinese mills has been at $805-810/mt FOB. But a deal for this grade was done to Vietnam at $825/mt CFR or $790-795/mt FOB from a trader. The lowest possible level has been assessed at $815/mt CFR for prompt shipment.
During the given week, China’s local HRC prices have indicated slight rises amid the increasing trend in HRC futures prices. Market players have been bullish towards the prospect for the future market for the most of the past week, pushing up HRC offer prices. But the demand for HRC has not seen significant improvement, which has exerted a negative impact. Moreover, the fall in futures prices since Friday has also caused most sentiments to be mixed. It is thought that HRC prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week.
Domestic HRC prices in China are at RMB 4,720-4,810/mt ($739-753/mt) ex-warehouse on November 30, with the average price level RMB 50/mt ($7.8/mt) higher as compared to November 23, according to SteelOrbis’ data. Compared with the price level on Monday, November 29, average local quotations are RMB 5/mt ($0.78/mt) higher.
As of November 30, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,588/mt ($718/mt), increasing by RMB 165/mt ($25.8/mt) or 3.73 percent since November 23.
$1 = RMB 6.3794