During the week ending December 9, pre-painted galvanized iron (PPGI) prices in the Chinese domestic market have trended sideways amid the wait-and-see stance adopted by traders and the slowdown in shipments. Local PPGI prices in China can ve viewed in the SteelOrbis price reports section.
Traders state that the slowdown in activity in the Chinese PPGI market results from a number of factors, including the cold winter weather conditions, the completion of many construction projects and lack of new projects, and, finally, the limited purchases of downstream users. Meanwhile, current PPGI inventory levels in the market are not too high and, supported by raw material costs, traders continue to maintain a wait-and-see stance and are not willing to sell at lower prices. Accordingly, PPGI prices in China have followed a stable trend in the past week.
Overall, due to the poor outlook in the downstream industry and for exports, most traders lack optimism as regards the prospects for the Chinese PPGI market at the start of 2012. In the short run, the imbalance between supply and demand in the domestic steel market appears to be increasing, while funds are tight approaching the end of the year. Meanwhile, traders state that PPGI prices may see a further downturn. As regards the coming week, it is expected that PPGI prices in the Chinese domestic market will trend down slightly or remain stable.