Over the past week (July 1-8, 2009), the Chinese domestic cold rolled market has generally moved on a stable trend, with slight decreases seen in some regions, especially in the north. These price decreases have mainly been caused by weak demand. However, as inventories in the leading markets are now at low levels and are indicating a shortage of certain specifications, many traders retain a positive outlook as regards the future market.
Product name |
Specification |
Category |
Average price(RMB/mt) |
Weekly change (RMB/mt) |
Price($/mt) |
1.0 mm x 1,250 x C |
SPCC |
4,657 |
-10 |
682 |
|
CRS |
1.0 mm x 1,250 x 2,500 |
SPCC |
4,727 |
-16 |
692 |
The decreasing momentum has been noticeable in particular in the northern Chinese market, primarily due to the rapidity of the rising movement of prices in the previous period and also due to the slackening of end-user demand. However, according to local traders, the price decrease seen this week is just a normal market adjustment and will not result in any significant impact, in particular given the low levels of supplies. The local traders expect a more stable trend for the coming week.
As regards the eastern and southern Chinese markets, prices are unchanged as compared to the previous week. Although inventories have also remained at low levels with a lack of supplies observed for certain specifications, demand from downstream industries is still showing some weakness, and the overall level of sales activities is lower than expected.
According to the census data, as of July 3 cold rolled coil inventory in the Shanghai market stood at 310,000 mt, up 5,000 mt week on week.
On July 7, Hubei Province-based steelmaker WISCO (Wuhan Iron and Steel Co., Ltd) issued its new list prices for some products for August, increasing its CRC price by RMB 480/mt ($70/mt). As a result, the producer's price of Q195 1.0 mm cold rolled sheet is now at RMB 4,850/mt ($710/mt) ex-mill, while its price of Q195 1.0 mm cold rolled coil stands at RMB 4,800/mt ($703/mt). All prices exclude 17 percent VAT and are effective from July 7, 2009.
On the export side, during the period in question an upward trend has been observed in ex-China cold rolled coil offers. Currently, Chinese cold rolled coils are being offered to the export markets at $600/mt FOB, registering an increase of $30-50/mt week on week, but with no interest coming from customers. As some foreign trade companies have reported, the export market is now been less active than before, and overseas importers have started to adopt a wait-to-see stance towards the market.