Ex-China hot dip galvanized (HDG) offer prices from large mills have moved down slightly, but the tradable levels and deal prices have been going down much faster, pushed by the still limited demand. At the same time, the local market has been relatively stable in terms of prices.
Offers from large mills this week are at $730-750/mt FOB for late July shipment, moving down by $10/mt on average compared to May 4 on average.
Reference deal prices for ex-China Z120 HDG have been heard at $695-705/mt FOB, down sharply from $740/mt FOB last week. Small-tonnage deals have been reported at the lower end of the range. A number of mills have been offering Z80 HDG in the export market at $683-687/mt FOB. Usually, Z80 coils are $10/mt cheaper than Z120.
“Temporary rises in HRC futures prices bolstered market sentiments in the HDG market early this week, while they moved down later, weakening the support for HDG prices amid gloomy expectations in the traditional offseason,” an international trader said.
During the given week, HDG prices in the Chinese domestic market have fluctuated within a limited range amid decreasing production and slack demand. HRC futures prices saw big rises on May 8, while they moved down again in the latter part of the week, exerting a negative impact on the HDG market. Currently, most market players hold a cautious view of the future prospects for the HDG market. It is expected that HDG prices will edge down in the coming week.
Average 1.0 mm SGCC hot dip galvanized spot prices in China have lost RMB 6/mt ($0.9/mt) compared to May 4, standing at RMB 4,617/mt ($668/mt) ex-warehouse, according to SteelOrbis’ information.
As of May 11, HRC futures prices at the Shanghai Future Exchange are standing at RMB 3,653/mt (529/mt), decreasing by RMB 10/mt ($1.4/mt) or 0.27 percent since May 4.
$1 = RMB 6.9101