Domestic hot-rolled coil prices in China were largely stable but in a wider range on Wednesday September 22, even as futures prices in the ferrous complex jumped on the first trading day after a three-day holiday for the Mid-Autumn Festival.
Eastern China (Shanghai): ۵,۷۲۰-۵,۸۰۰ yuan ($885-897) per tonne, widening by 10-20 yuan per tonne
After oscillating in negative territory for most of the day, the most-traded HRC contract on the Shanghai Futures Exchange surged in the last hour of trading before closing on Wednesday. This was likely sparked by a strong rally in rebar, coking coal, coke and iron ore.
HRC futures lagged behind their rebar counterparts because the impact on rebar production from escalated production curbs in some Chinese regions is expected to be greater than that on HRC, a Shanghai-based trader said.
Increased supply concerns boosted coking coal and coke, while steel prices got another lift from the production curbs which have been tightened in some regions, with local governments rushing to hit their annual targets of controlling crude steel output and reducing energy consumption.
Trading liquidity across the domestic HRC spot market was active on Wednesday, sources reported.
Fastmarkets’ steel hot-rolled coil index export, fob main port China: $۹۲۵ per tonne, down by $1.25 per tonne
Trading liquidity for Chinese HRC exports remained thin, with their appeal dented by cheaper resources from other countries and the persistent export duty risks.
Trading houses were offering SS400 HRC at above $920 per tonne fob China. They indicated that $910-940 per tonne might be workable for them, unchanged from their indications made last Friday.
There was a transaction confirmed at $850 per tonne cfr southern Vietnam for two to three vessels of December-shipment Russian HRC, which market sources estimated to be for 70,000-100,000 tonnes of material. Vietnamese buyers were bidding at $840 per tonne cfr Vietnam for Russian cargoes.
A major Indian steel mill lowered its offer to $900 per tonne cfr Vietnam on Wednesday after the transaction.
It also came to light that Kazakhstani SS400 HRC was sold last week at about $870 per tonne cfr Vietnam, although the actual price could not be confirmed by the parties involved.
“Chinese HRC prices have reached the levels that deter both flows into and out of China’s market,” a Tianjin-based trader said. “Export prices for Chinese HRC are higher than offers for cargoes originating from India, Russia and other regions, while imports are not coming in as the prices are still higher than China’s domestic market.”
Shanghai Futures Exchange
The most-traded January HRC contract ended at 5,761 yuan per tonne on Wednesday, up by 84 yuan from last Friday’s close.
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