Ex-China hot dip galvanized (HDG) prices from mills have moved sideways this week following the long Chinese New Year holiday (February 9-16) as only some market players have been back in the market. However, tradable prices have been moving down affected by lower local prices and slow demand overseas.
Specifically, offers from large mills are still heard at around $725-730/mt FOB for April shipment, remaining stable compared to February 8. Meanwhile, the reference deal prices for ex-China Z120 HDG have been heard at around $675-685/mt FOB, compared to $675-700/mt FOB recorded ahead of the long holiday.
During the given week, demand for HDG from downstream users has not improved yet as some market participants are back in the market. Moreover, a wave of cold weather is hitting China, exerting a negative impact on the HDG market. At the same time, HRC futures prices have indicated a downtrend following the long holiday, weakening the support for HDG prices. Meanwhile, inventory of HDG has been at relatively high levels, negatively affecting prices. It is thought that HDG prices may indicate a fluctuating trend within a limited range in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have lost RMB 14/mt ($2/mt) compared to February 8, standing at RMB 4,753/mt ($669.4/mt) ex-warehouse, according to SteelOrbis’ information.
As of February 22, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,902/mt ($550/mt), decreasing by RMB 82/mt ($11.5/mt) or 2.05 percent compared to February 8, while indicating a decline of 0.15 percent compared to the previous trading day (February 21).
$1 = RMB 7.1018
