During the past week China's domestic pre-painted galvanized iron prices maintained a stable trend. For example, the price of CGCC 0.476 mm x 1,000 mm x C material produced by Wuxi NewDaZhong now stands at RMB 4,900/mt, the same level as last Friday.
This week the domestic market prices in China of major steel products such as HR, CR, rebar, wire rod and HDG experienced fluctuations. The prices of these products jumped up at first before starting to decline; on the other hand, however, PPGI prices remained practically flat. At present PPGI inventories are still high, as mills maintain normal production rates despite the low prices. Thus it is difficult for prices to climb up. Meanwhile, traders maintain their wait-and-see stance as prices fluctuate. However, most traders are still not optimistic about the future market due to the weak deal situation and the poor global environment. According to the data for March, the export volume of China's pre-painted coils, strips and plates came to 106,344 mt, down 18 percent from the February level. The import volume in March for these materials came to 40,711 mt, 30.81 percent higher than for February. In addition, China's production of pre-painted coils, strips and plates during the month in question came to 342,500 mt, 20.22 percent higher than the February output figure.
As for the domestic mills, Bensteel this week issued its pre-painted coil ex-works prices for May, making no change from the April level. Thus, the producer's price for 0.47 mm TDC51D material still stands at RMB 4,850/mt ($710/mt), excluding VAT. The mills are also seen to be maintaining a wait-and-see stance.
Based on the situation observed this week, China's domestic PPGI market is likely to decline next week as most other steel products in China have already entered a downtrend. The brief rise and swift decline of steel product prices in China this week indicate that at present the markets are not ready yet for a more permanent increasing movement and that there is still further room left for a decline. However, with the weather getting warmer and demand improving, the bottom is not expected to be too far away.