In the given week, some traders have been selling HDG at low prices, leaving significant room for negotiations. Nevertheless, overall market activity is still unsatisfactory. As traders are anxious about the future pricing trend, they have kept their HDG stocks at extremely low levels. Also, since traders are not purchasing large tonnages, HDG producers are now under pressure from high inventories. Despite the official announcements of production cuts made by some private sector mills, current inventory is still too high to provide relief from oversupply. Due to high inventory, many private sectors producers have been forced to lower their HDG offers, thereby exerting further downward pressure on the market.
On the whole, it is expected that the Chinese HDG market will continue to decline in the coming week.