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Kallanish Kallanish

Knowledge matters Knowledge matters

January, 21st 2019

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JUN 14

Chinese HRC gains but exports still struggling


Chinese hot rolled coil futures gained a little ground on Thursday despite inventories ticking up very slightly. On export markets meanwhile offers were few but prices continue to increase steadily, Kallanish notes.

On the Shanghai Futures Exchange the October HRC contract closed at CNY 3,979/tonne ($623/t), CNY 16/t higher than Wednesday. HRC inventories have begun to trend upwards as they have not enjoyed to sustained demand for construction longs. Total HRC inventories monitored by SMM edged up 0.4% this week to 2.95 million tonnes. This was driven by a 1.1% increase in market inventories to 2mt.

On export markets meanwhile there were few mill offers as domestic prices were still more attractive. For rerolling grade there were very few offers but one northern mill was offering at around $610/t fob. Offers were also heard at around $625/t cfr Vietnam. For SS400 3mm+ HRC offers were more common, with one major exports lifting its offer by $5/t to $600/t fob. Kallanish assessed 2mm SAE1006 HRC at $605-610/t fob, $7.5/t higher than a week ago.