Over the past week very little activity has been seen in China's import and export markets for flat rolled steel products.
Considering the strong inventory pressure caused by the arrivals of many previously-ordered imported materials, and also taking into account the slim profit margin, Chinese purchasers have begun to lose interest in import activity.
Currently, Russian producer MMK is offering 2.0-3.0 mm hot rolled products at $405-410/mt CFR China's major ports for June and July shipment. Meanwhile, quotations of 2.0 mm SPHC HRC of Japanese origin remain at $400/mt CFR, while Japanese 1.0 mm CRC is offered at $440/mt CFR.
On the export side, there are still few takers in spite of the continuous decrease in export quotations. According to some Chinese traders, inquiries from India and Africa seemed quite active in the past week, but the prices of almost all the Chinese products remained at a relatively high level, and so lacked any price advantage. Even for those who received inquiries and managed to conclude deals, the trading volume was very small.
Over the past week export quotations of Chinese flat rolled products continued their sliding trend. At present, Chinese traders are offering common carbon HRC in the range of $450-470/mt FOB, down $10-20/mt from the previous week. Meanwhile, export quotations of DC01 1.0 mm CRC from China's second tier producers have declined $10/mt week on week to $490-510/mt FOB.
Looking at the current situation, time is needed for the market to get warm. On the one hand, the macro-economic figures have been indicating certain positive signs, and so many trading companies hope that the international market will see some improvements in the next month. On the other hand, some traders still maintain their wait-and-see stance, in anticipation of a further decline in domestic prices of flat rolled products and also of a reduction in the new iron ore contract price. These traders are expected to become more active when the future situation becomes clearer.