Ex-China HRC prices up slightly amid local gains, but sustainability of further rise doubtful

Tuesday, 23 April 2024 12:19:46 (GMT+3)   |   Shanghai
       

Ex-China HRC prices from mills have moved up further this week amid increasing local HRC prices coupled with higher prices for raw materials. However, according to market insiders, demand is still not sufficient globally to support a sharp rise in prices, thus, the sustainability of further price increases is questionable, with futures HRC prices moving down since Monday putting an additional pressure on Chinese exporters.

Specifically, export offers for boron-added SS400 HRC from large Chinese mills have settled at $540-550/mt FOB, with a midpoint at $545/mt FOB, up by $5/mt week on week. Besides, most offers from smaller mills have been heard at $535/mt FOB, against $530-535/mt FOB last week.

Meanwhile, the tradable levels for ex-China SS400 HRC have been estimated at $530-535/mt FOB, versus $520-530/mt FOB at the beginning of last week. Most offers for ex-China Q235 in Vietnam have been heard $540-550/mt CFR, up by $10-15/mt over the past week. At the same time, offers to the Middle East have been reported at around $560/mt CFR and above with trade activity remaining slow so far.

At the same time, average HRC prices in the Chinese domestic market have mostly moved up amid the improved demand and rising HRC futures prices, however the heavy rains in some regions of Guangdong province negatively affected HRC prices there. Domestic HRC prices in China are at RMB 3,880-3,990/mt ($546.5-562/mt) ex-warehouse on April 23, with the average price level RMB 24/mt ($3.4/mt) higher compared to that recorded on April 16, according to SteelOrbis’ data.

During the given week, HRC prices in the Chinese domestic market have mostly indicated an uptrend amid the better demand from downstream users, though the flood in some regions of Guangdong province exerted a negative impact on HRC prices locally. Following the improved demand, some HRC producers gradually increased their capacity utilization rates, increasing the supply to the market, which will likely weaken the support to its prices in the near future. Meanwhile, raw material prices, including coke and import iron ore, have seen an uptrend, providing certain support to HRC prices from cost side. It is expected that HRC prices in the Chinese domestic market will likely continue the uptrend in the coming week, especially ahead of the Labor Day holiday (May 1-5), as downstream users might build up certain stock.

As of April 23, HRC futures at Shanghai Futures Exchange are standing at RMB 3,797/mt ($535/mt), increasing by RMB 20/mt ($2.8/mt) or 0.5 percent since April 16, while down 0.68 percent compared to the previous trading day, April 22.

Product

Spec

Quality

City

Origin

Price(RMB/mt)

W-o-w change

HRC

5.75mm*1500*C

Q235B/SS400

Shanghai

Angang

3,990

+40

Tianjin

Baotou Steel

3,910

+50

Lecong

Liuzhou Steel

3,880

-20

Avg

 

3,927

+24

HRC

2.75mm*1250*C

Q235B

Shanghai

Angang

4,100

+40

Tianjin

Baotou Steel

3,970

+50

Lecong

Angang

3,960

-20

Avg

 

4,010

+24

$1 = RMB 7.1059


Tags: Hrc Flats China Far East 

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