Asian hot-rolled coil prices softened entering the week of Oct. 13, with market sentiments in China dampened by the escalation of US-China trade tensions that occurred over the weekend.
Platts assessed SS400 HRC of 3 mm thickness at $462/mt FOB China on Oct. 13, down $5/mt from Oct. 10. The same grade was assessed at $474/mt CFR Southeast Asia, down $4/mt over the same period.
Fears of worsening trade relationships between the US and China arose when US President Donald Trump threatened to impose additional tariffs on Chinese imports after China expanded its rare earth export controls.
Although Trump softened his tone afterward and indicated willingness to discuss further, the fear still lingers.
Following the tensions, the most actively traded January HRC contract on the Shanghai Futures Exchange closed at Yuan 3,261/mt on Oct. 13, down Yuan 24/mt, or 0.7% from Oct. 10.
Mills in China also reduced their export offers to an upward of $466/mt FOB China.
Despite the cuts in offers, buying interests in the seaborne market were heard to be scarce, with overseas buyers stepping back from actively bidding and preferring to gain more clarity first, according to a Hangzhou-based trader.
Seller’s tradable values for a mainstream mill also softened to $470-$475/mt FOB Bayuquan, although the mill has not updated its official offers yet.
“We’re going to have some offer adjustments over the coming two days,” said a source from the mill, adding that there will not be drastic cuts at the moment. “The overseas demand hasn’t started with [buyers] on the sidelines. We’re not in a hurry either, with sufficient time to take orders.”
Domestic steel offtakes were heard to be of moderate levels, though not as good as pre-holidays, according to two China based sources.
Platts assessed the spot price of Q235B 5.75 mm HRC at Yuan 3,320/mt ($465/mt) ex-stock Shanghai on Oct. 13, including value added tax, down Yuan 40/mt from Oct. 10.
In Southeast Asia, offers for wider-width Q235 coils continued to slide to $485-$490/mt CFR Vietnam. Bids were even lower, at $480/mt CFR Vietnam.
The spread between wider-width and regular-width coils of 1,200 mm-1,500 mm wide continued to hover in the range of $5-$10/mt.
“Buyers are worried about any potential antidumping duties [that may apply retrospectively over the wider width coils]. Now everyone is just waiting for the offer updates from Formosa Ha Tinh Steel,” said a Vietnam-based trader.
Concurrently, Indonesian SAE1006 grade coils were heard offered at $495/mt FOB Morowali for January shipment.
An Indonesia-based mill source said, “The export sales [of HRC] have been slow recently, with most buyers watching only.
We’re busy with billet production and trying to get orders shipped to Europe by the end of October.”
Platts assessed SAE1006 HRC at $481/mt FOB China on Oct. 13, down $2/mt from Oct. 10. The same grade of coil was unchanged over the same period at $506/mt CFR Southeast Asia.
