Traders have told SteelOrbis that demand from downstream users has not fully recovered yet, with transaction volumes at around 1,000 mt per day for large traders, which is below normal levels.
Some shortages in the spot market have been observed for main HDG specifications such as 1.0mm x 1,250 mm, for which transaction activity has been higher. Some traders are cautious about placing orders due to higher costs of materials for future deliveries and so supplies in the market may be limited in the coming period. However, China's average daily crude steel output in late February remains high level of 2.0342 million mt, up 1.4% compared to mid-February. This will likely eventually result in increased HDG supplies in the spot market.
As for the coming week, it is thought that HDG prices in the Chinese domestic market are unlikely to drop down and may instead move sideways due to cost support.