Cold rolled prices have continued to climb at a significant rate in the past week (November 11-17) in China's domestic market. In particular, the local market has received a boost from the latest price adjustments made by several leading mills such as Baosteel Group.
Product name | Specification | Category | Average price (RMB/mt) | Weekly change (RMB/mt) | Price ($/mt) |
CRC | 1.0 mm x 1,250 x C | SPCC | 4,967 | +127 | 728 |
CRS | 1.0 mm x 1,250 x 2,500 | SPCC | 5,150 | +117 | 755 |
Influenced by the new price adjustments announced by several leading mills, most traders who are expecting to see price increases in the market have started to raise their sale prices of cold rolled products or to build up their inventories. However, other traders are not so optimistic as regards the prospects for the market, as they believe that the demand coming from downstream industries will shrink gradually due to the winter season.
The official statistics show that during the past week cold rolled inventory in the southern markets registered the greatest decrease, while inventory in the eastern markets saw the largest rise. In general, the total inventory level in China's main cold rolled markets has been declining continuously. At present, cold rolled inventory in China's leading cold rolled markets stands at 1,130,580 mt, decreasing by 380 mt from the previous month and up 19 percent year on year. As of November 13, cold rolled inventory in Shanghai stood at 357,780 mt, marking an increase of 11,920 mt compared to the previous week.
During the period in question, several leading steel producers including Baosteel, WISCO (Wuhan Iron and Steel Co., Ltd), Anshan Steel and Benxi Steel issued new price lists for December. Baosteel has kept its cold rolled product prices unchanged, but has canceled discounts. As a result, its price for SPCC 1.0 x 1,250 mm x C cold rolled plate is now at the level of RMB 4,976/mt ($730/mt) ex-mill.
Meanwhile, WISCO group has hiked its CRC price by RMB 300/mt ($44/mt), and so the ex-factory price of Q195 1.0 mm cold rolled plate now stands at RMB 4,850/mt ($711/mt). Anshan Steel raised its CRC prices by RMB 400/mt ($59/mt), and so its ST12 1.0 mm cold rolled plate is now priced at RMB 4,390/mt ($644/mt). At the same time, Benxi Steel has adjusted its cold rolled prices in the same direction as the other main plants, with its CRC price rising by RMB 320/mt($47/mt). Accordingly, Benxi Steel's DC01 1.0 mm x 1,250 mm CRC ex-mill price is currently at RMB 4,360/mt ($638/mt). All prices exclude 17 percent VAT.
To sum up, the continuing downtrend of cold rolled inventory, the strong increases in the list prices of the leading mills and the positive macroeconomic situation (as evidenced by the favorable economic indicators recently released by China's National Bureau of Statistics) have all provided support for China's local cold rolled market, which is expected to follow a mild rising trend in the coming period.