Posted on 15 Aug 2023
Prices of hot-rolled coil (HRC) in China's domestic market lost some ground over August 7-14. Dull demand for hot coils from end-users was mainly blamed for the drop in the prices, a market insider said.
As of August 14, China's national price of Q235 4.75mm HRC had declined to Yuan 3,971/tonne ($546.3/t) including the 13% VAT, down by Yuan 58/t from one week earlier, according to Mysteel's assessment.
Many traders lost confidence and cut their offering prices after noting the decline in HRC prices on the Shanghai Futures Exchange (SHFE), a Shanghai-based analyst said.
For example, the most-traded HRC contract for October delivery on SHFE closed the daytime trading session at Yuan 3,889/t on August 14, down by Yuan 87/t in total from the settlement price on August 7, according to the exchange's data.
Total production of hot-rolled coils among the 37 Chinese flat steelmakers under Mysteel's regular tracking grew over August 3-9, rising by 64,500 tonnes or 2.1% on week to settle at 3.1 million tonnes, as some steelmakers resumed production after maintenance stoppages. During the same survey period, hot-rolling capacity use among these sampled mills also grew by 1.64 percentage point on week to 79.63%, according to Mysteel's data.
Many end-users slowed their buying of hot coils and took a cautious stance during the survey period, mainly due to the slack period for steel consumption and lack of confidence, he added.
HRC stocks at trading houses across the 33 cities under Mysteel's tracking increased by 13,800 tonnes or 0.5% on week to 2.9 million tonnes as of August 10.
Meanwhile, as of August 9 HRC inventories held by the 37 surveyed mills Mysteel tracks gained by 23,100 tonnes or 2.8% on week to reach 858,100 tonnes.
Source:Mysteel Global
