Ex-China HRC offer prices have edged down further in the past week following the downtrend in the previous week as mills have faced reduced demand and have been trying to push volumes.
At present, export offers for boron-added SS400 HRC given by major Chinese mills are at $860-920/mt FOB for August shipment, with a midpoint at $890/mt FOB, moving down by $40/mt on average compared to June 22. “The sluggish demand in the major export destinations amid the Covid-19 pandemic have made Chinese HRC exporters cut their export offer prices, while importers in ASEAN countries have resisted exporters’ requests for them to bear the possible export tax on HRC,” an international trader told SteelOrbis.
The tradable price level for SS400 coils has decreased to $850-860/mt FOB lately, down from the level of $880-895/mt FOB last week. Moreover, some small volumes of thick SS400 HRC were sold to Vietnam at $850-860/mt CFR, according to sources.
The workable price level for SAE1006 HRC from Chinese small mills and traders has been reported at $860-870/mt FOB, versus $890-910/mt FOB early last week.
During the given week, China’s local HRC prices have indicated rises amid increasing HRC futures prices and improved sentiments among market players because of some reductions in supply recently. Demand for HRC has still been slack in the traditional offseason, and so downstream users have mostly held a wait-and-see stance as regards the future prospects for the market. Since the 100th anniversary of the founding of the Communist Party of China (July 1) is approaching, there will be more production restrictions, which will reduce supply of HRC and support prices.
Domestic HRC prices in China are at RMB 5,310-5,460/mt ($861-869/mt) ex-warehouse on June 29, with the average price level RMB 110/mt ($17/mt) higher as compared to June 22, according to SteelOrbis’ data. Compared with the price level on Monday, June 28, average local quotations are RMB 40/mt ($6/mt) higher.
As of June 29, HRC futures at the Shanghai Futures Exchange are standing at RMB 5,315/mt ($823.2/mt), increasing by RMB 162/mt ($25.1/mt) or 3.14 percent since June 22.
$1 = RMB 6.4567