Ex-China HRC offer prices have continued their downtrend amid the strict Covid-19 measures in many regions of China and rainy weather, which have dragged down demand and prices locally. So even despite the unexpected 15 percent duty on Indian HRC as of May 22, the market has remained bearish.
At present, export offers for boron-added SS400 HRC given by large Chinese mills are at $745-760/mt FOB for June shipment, with a midpoint at $752.5/mt FOB, posting a $32.5/mt drop on average compared to last week. Offers from small mills and traders have been reported at $720-730/mt FOB already, down by $10/mt over the past week.
The tradable level for ex-China SS400 HRC has been settled at $720-750/mt FOB, though the higher end of the current range is only for some rare markets.
“Rainy weather and the strict Covid-19 measures have negatively affected the HRC market,” an international trader told SteelOrbis.
During the given week, HRC prices in the Chinese domestic market have moved down amid the slack demand from downstream users due to the Covid-19 measures. Meanwhile, as it is approaching the end of the month, market players face tight liquidity, which has also exerted a negative impact on the HRC market. It is thought that HRC prices in the Chinese domestic market will fluctuate within a limited range in the coming week.
Domestic HRC prices in China are at RMB 4,760-4,850/mt ($715-728/mt) ex-warehouse on May 24, with the average price level RMB 94/mt ($14/mt) lower as compared to May 17, according to SteelOrbis’ data.
As of May 24, HRC futures at the Shanghai Futures Exchange are standing at RMB 4,609/mt ($692/mt), decreasing by RMB 161/mt ($24.2/mt) or 3.4 percent since May 17.
$1 = RMB 6.6566