China’s domestic hot-rolled coil prices rebounded on Tuesday March 2 amid recovering demand, sources told Fastmarkets.
*** Domestic
Eastern China (Shanghai): ۴,۸۴۰-۴,۸۶۰ yuan ($749-752) per tonne, up 20 yuan per tonne
A Shanghai-based trader said trading activity picked up on Tuesday, which helped push prices upward.
He said the company he works for was receiving a steady stream of orders – close to its daily average – because downstream companies had resumed production after the Chinese New Year holiday in February.
In contrast, the company was getting just 70-80% of its daily average of orders last week, he said.
Rebounding futures helped to bolster sentiment in the spot market, a second Shanghai-based trader said.
Most market participants are optimistic about prices over the next few weeks because of the government’s intention to cut steel capacity this year, she said.
A Shanghai-based trader said trading activity picked up on Tuesday, which helped push prices upward.
He said the company he works for was receiving a steady stream of orders – close to its daily average – because downstream companies had resumed production after the Chinese New Year holiday in February.
In contrast, the company was getting just 70-80% of its daily average of orders last week, he said.
Rebounding futures helped to bolster sentiment in the spot market, a second Shanghai-based trader said.
Most market participants are optimistic about prices over the next few weeks because of the government’s intention to cut steel capacity this year, she said.
*** Export
Fastmarkets’ steel hot-rolled coil index export, fob main port China: $۶۹۸٫۶۸ per tonne, down $1.62 per tonne
Northern China’s Benxi Iron & Steel is offering its HRC at $740 per tonne fob this week, up by $30 per tonne from $710 per tonne fob last week.
Shandong Iron & Steel is asking for $730 per tonne fob, up by $30 per tonne from last week’s $700 per tonne fob.
Traders largely expect difficulty in securing HRC below $700 per tonne fob after these upward revisions, although a Zhejiang-based trader said he could get HRC from a private mill in northern China at around $685 per tonne fob.
But not many traders are booking cargoes from mills amid concerns over further increases in shipping costs.
Adding to those concerns is the possibility of an export tax rebate cut in China for steel products.
The Zhejiang-based trader said his customers in Pakistan were willing to pay up to $720 per tonne cfr Pakistan, equivalent to around $685 per tonne fob China, but the uncertainties over the export tax rebate and freight rates are keeping him from entering into any transactions.
Northern China’s Benxi Iron & Steel is offering its HRC at $740 per tonne fob this week, up by $30 per tonne from $710 per tonne fob last week.
Shandong Iron & Steel is asking for $730 per tonne fob, up by $30 per tonne from last week’s $700 per tonne fob.
Traders largely expect difficulty in securing HRC below $700 per tonne fob after these upward revisions, although a Zhejiang-based trader said he could get HRC from a private mill in northern China at around $685 per tonne fob.
But not many traders are booking cargoes from mills amid concerns over further increases in shipping costs.
Adding to those concerns is the possibility of an export tax rebate cut in China for steel products.
The Zhejiang-based trader said his customers in Pakistan were willing to pay up to $720 per tonne cfr Pakistan, equivalent to around $685 per tonne fob China, but the uncertainties over the export tax rebate and freight rates are keeping him from entering into any transactions.
*** Market chatter
“I think some domestic buyers have stepped up their restocking today upon seeing the price gains. Based on what I have learned, many market participants believe prices are likely to stay high or will experience bigger gains than losses over the next few weeks,” a third Shanghai-based trader said.
Shanghai Futures Exchange
The most-traded May HRC futures contract closed at 4,907 yuan per tonne on Tuesday, up by 66 yuan per tonne from Monday.
Shanghai Futures Exchange
The most-traded May HRC futures contract closed at 4,907 yuan per tonne on Tuesday, up by 66 yuan per tonne from Monday.
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