Ex-ChinaHRCoffer prices have moved up sharply as local prices have indicated big rises after the Labor Day holiday and as supply will remain tight in relation to demand in the coming period.
At present, export offers for boron-added SS400HRCgiven by major Chinese mills are at $1,040-1,080/mt FOB for June shipment, with a midpoint at $1,060/mt FOB, moving up by $120/mt on average compared to before the Labor Day holiday.
Following the cancellation of the export tax rebate and the big rises in ex-ChinaHRCoffer prices, overseas buyers have mostly been holding a wait-and-see stance. The tradable price is assessed at not below $1,040/mt FOB for SS400HRC.
“The expected production restrictions, decreasing inventory, and the peak season forHRCin the local market have all exerted positive impacts on ex-ChinaHRCprices. Ferrous metal futures prices inChinahave indicated significant increases on May 10 and May 11, which will likely result in further rises inHRCexport offer prices in the coming period,” an international trader told SteelOrbis.
During the given week,HRCfutures prices have risen sharply amid speculation and rises in many other segments like raw materials. Bullish sentiments have prevailed among market players, bolstering domesticHRCprices inChina. At the same time, demand has been very active, though some downstream users have been cautious at the current high levels ofHRCprices. Furthermore, inventory ofHRChas been at a relatively low level, which will exert a positive impact on prices. It is thought thatHRCprices in the Chinese domestic market still have some room to edge up.
DomesticHRCprices inChinaare at RMB 6,430-6,560/mt ($1,001-1,021/mt) ex-warehouse on May 11, with the average price level RMB 760/mt ($118/mt) higher as compared to April 27, according to SteelOrbis’ data. Compared with the price level on Monday, May 10, average local quotations have remained stable.
As of May 11,HRCfutures at the Shanghai Futures Exchange are standing at RMB 6,540/mt ($1,018/mt), increasing by RMB 852/mt ($132.6/mt) or 15.0 percent since April 30.
$1 = RMB 6.4254