During the past week China's domestic hot rolled market first climbed up before falling back down against a background of still considerable inventory pressure.
Product name | Specification | Category | Average price(RMB/mt) | Weekly change (RMB/mt) | Price ($/mt) |
HR | 5.75 mm x 1,500 mm | Q235B | 3,243 | -84 | 476 |
HR | 2.75 mm x 1,250 mm | Q235B | 3,390 | +17 | 497 |
Last week, apart from the supply shortage of 1,500 mm x C coils of thicknesses greater than or equal to 3.75 mm, the eastern China market - China's leading market - registered plentiful supplies of thin coils, which exerted downward pressure on the market. According to the latest statistics, hot rolled inventory in Shanghai amounted to 759,200 mt on April 24, down 25,170 mt week on week. Meanwhile, in southern China, the Lecong market still saw concentrated arrivals of new supplies, with the local hot rolled inventory rising slightly week on week to 750,000 mt. As regards the northern market, trading activity became slack in the past week when the market prices went up to the level of RMB 3,280/mt ($481/mt). According to the latest statistics, hot rolled inventory in Tianjin reached 170,000 mt on April 24, indicating relatively strong supply pressure.
During the past week, Benxi Steel lowered its hot rolled prices by RMB 290/mt ($43/mt), with the ex-factory price of 5.5 mm Q235 declining to RMB 2,740/mt ($402/mt, excluding taxes) and that of 2.75 mm at RMB 2,810/mt ($412/mt, excluding taxes). Currently, China's leading mills are offering their hot rolled products in the range of RMB 3,000-3,100/mt ($440-455/mt, including taxes). Nevertheless, most domestic hot rolled producers do not plan to cut their production for May; instead, it is heard that Shagang will increase its hot rolled production to 95 percent of capacity during the month in question.
Thus, taking market supply and demand into consideration, significant pressure still exists in the Chinese hot rolled market. In the short term the market is expected to move on a fluctuating trend.