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Fastmarkets’ price assessment for steel hot-rolled coil domestic, ex-whs Eastern China (Shanghai) was 4,300 yuan ($625) per tonne on Tuesday, up by 20 yuan per tonne from 4,280 yuan per tonne March 27.
The value of the most-traded May HRC futures contract on the Shanghai Futures Exchange rose after falling to an intraday low of 4,209 yuan per tonne during Monday’s night trading.
A trader in eastern China attributed rallies in SHFE HRC and rebar to the extended gains in prices for iron ore.
The value of the most-traded iron ore futures contract on the Dalian Commodity Exchange rose for a third straight trading day on Tuesday and hit a one-week high of 884 yuan per tonne.
Spot HRC trading in eastern China improved from the previous week when industry data indicated a weekly decline in HRC apparent demand. Whether steel demand remains resilient will prove crucial to the market, a trader in northern China added.
Fastmarkets assessed its steel hot-rolled coil index export, fob main port China at $629 per tonne on Tuesday, up by $0.67 per tonne from $628.33 per tonne on Monday.
Chinese mills and trading houses kept their offers for HRC exports virtually unchanged on Tuesday compared with the previous day.
Mills were offering May- and June-shipment SS400-grade HRC at $660-680 per tonne FOB China.
Market participants’ estimates of the costs for sourcing SS400-grade HRC from small mills in northern China held stable at $625-630 per tonne FOB.
In Vietnam, the major market for Chinese HRC exports, offers for China-origin SS400- and Q195-grade HRC were $625-628 per tonne CFR.
Trading for HRC exports has yet shown signs of improvement, with buyers tending to wait and see “for a while” after prices stemmed their decline, a second trader in eastern China said.
“This year’s demand recovery looks unlikely to be consistent. It will weaken for a while following a bout of active trading. If the demand recovery remains stable, the downside in [Chinese] steel prices may be limited. Otherwise, prices would collapse. On the supply side, hot metal output remains high with positive margins encouraging mills to maintain production,” the northern China-based trader said.
The most-traded May HRC futures contract closed at 4,255 yuan per tonne on Tuesday, up by 30 yuan per tonne from Monday’s close.