The Asian HRC market continued its upward trend Oct. 16, amid improved market sentiment in China on a rising physical and futures market, along with firm offers from mills.
S&P Global Platts assessed SS400 HRC 3 mm thick at $510/mt FOB China, up $3/mt day on day. On a CFR Southeast Asia basis, the same grade of coil was assessed at $516/mt, up $3/mt day on day.
Mills remained firm on offers amid a relatively positive outlook for the export market in the near term. One eastern China mill was heard not negotiable for its offer at $515/mt FOB for December shipment.
“Some mills might increase offers slightly for the next week, with the improved buying interest from export market and strong currency,” said a Chinese mill source.
“Mills’ export interest is not so strong at the moment, due to the large fluctuation in currency,” said another mill source.
“It will depend on how mills calculate their profit for export orders, as currency is very disadvantaged now,” said a third mill source.
Separately, Platts assessed SAE1006 HRC at $518/mt FOB China, stable day on day. On a CFR Southeast Asia basis, the same grade was assessed at $523/mt, also steady.
In Vietnam, buying indications did not pick up further, as buyers were mainly having their negotiation with local steel producer Formosa Ha Tinh, or FHS.
The offering level was heard at $530-$535/mt CFR for SAE coils for December shipment, but buying an indication was heard staying in the range of $520-$525/mt CFR, largely stable on the day.
Both buyers and sellers were not active on the day, and buyers were not keen to book on Friday, said a Chinese trader. “The market is just so-so now, [there's] no clear direction yet,” said a Chinese mill source.
In Shanghai, the spot price of Q235 5.5 mm HRC was assessed at Yuan 3,895/mt ($581/mt) ex-stock, including value added tax, up Yuan 5/mt day on day.
On the Shanghai Futures Exchange, the most active January 2021 contract closed at Yuan 3,740/mt, up Yuan 15/mt, or 0.4%, day on day. This marked the first increase after the contract fell for three straight days by a total of Yuan 70/mt
-- Analyst Yuelin Dai
