Asian hot-rolled coil prices were unchanged Nov. 22 as buyers are mostly in a wait-and-see mode because of sluggish demand and a bearish outlook.
Platts assessed SS400 HRC 3 mm thick at $528/mt FOB China and $529/mt CFR Southeast Asia, both unchanged on the day. Platts assessed SAE1006 HRC at $533/mt FOB China and $538/mt CFR Southeast Asia, both unchanged on the day.
Mills in China are not willing to lower offers as the domestic HRC market and futures are firm despite rising COVID-19 cases in China and weak international markets.
“Currently, a number of mills cut production rates, shows that the market is gradually weakening, but prices should be steady in the short term,” an east China-based trader said.
Mills have previously concluded some large orders to regions like the Middle East, therefore they are not in a rush to sell or lower offers, the trader said.
Platts assessed the Q235 5.5 mm HRC spot price in Shanghai at Yuan 3,850/mt ($537.21/mt) ex-stock, including value added tax, up Yuan 10/mt on the day but down Yuan 20/mt from Nov. 18. The most actively traded January 2023 contract on the Shanghai Futures Exchange closed at Yuan 3,755/mt, down Yuan 1/mt on the day.
“The pandemic situation in China may affect market participants’ confidence in HRC market outlook as COVID-19 restrictions remained quite strict," a North China mill source said. "Few bids recently, probably because the domestic market is weaker these two days and buyers want to wait and see."
The Vietnam market is quiet with buyers not bidding as demand has not improved. Lower Chinese-origin import offers were heard in the $530-$535/mt CFR range for December shipment, but that did not attract buying interest, Vietnam-based traders said.
HRC markets in Indonesia and Pakistan are also not doing well.
“Our currency has weakened a lot and our government policy is contradictory -- raw material import is controlled tightly, but finished products can come in freely,” an Indonesia based buyer said.
A Pakistan-based trader said Pakistan's economy is weak with plenty of issues -- too much political instability, poor demand, cash flow crisis, and banks also discouraging letter of credit.
Platts assessed SPCC grade 1 mm thick cold-rolled coil at $585/mt FOB China, down $5/mt on the week as demand shows no sign of improvement.
Offers from Chinese mills were mostly unchanged from the week before in the $600-$610/mt FOB China range for January shipment due to a relatively steady Chinese domestic market.
Platts assessed the same CRC grade at Yuan 4,375/mt ex-stock, including VAT, in the Shanghai dealers' market, down Yuan 35/mt on the week.
“Deal price from mills can be quite different as some mills can sell Yuan 30-Yuan 50 higher, but in general, domestic CRC trading activity is not too good and deal price should be in the lower range,” another east China-based trader said.
A few traders said bid inquiries from overseas buyers are available, but their prices could not match with mill indications.
“Bigger mills like Shougang and Benxi Steel have no intentions of lowering offers, offers are around $610/mt FOB,” a third east China-based trader said.
Platts is part of S&P Global Commodity Insights.
