Chinese CRC And HDG Export Prices Slightly Fluctuate

Chinese CRC and HDG export prices have shown minor changes in early December, with export demand and domestic transactions remaining stable. Traders remain cautious due to concerns about a potential price drop in the future.

At the beginning of December, Chinese CRC and HDG export prices have shown
minor changes amid insignificant shift in the moods. While overseas customers
continue to purchase small lots mostly, buying in the local market stays resilient
with some price upticks.

This week, Chinese CRC average export prices have remained in the range of
$550-555/t FOB, though smaller mills offered at $5/t lower, while larger ones
around $5/t higher, closer to the upper end of the range. “The deals are done in
between $540-555/t FOB, it depends on the size of the mill,” a trader source told
Metal Expert. Export demand is still present, but buyers continue to purchase
cautiously due to a possible drop, especially after the futures market plunged on
Thursday amid the expectation that the government meeting next week will not
provide any significant support. “Customers are still cautious, but they need to do
some necessary purchase, so they buy small lots,” a trader commented.

HGD (Z120, 1 mm) prices of large mills have inched down by around $10/t to
$575-585/t FOB, though in fact such levels have been possible since November
when signing contracts, sources admit. Now contracts are signed within $560-575/t
FOB, where the lower end of the range is attributed to smaller producers, while
supply of large mills is limited as they allocate most of the material in the local
market at higher prices. “Large mills almost do not trade HDG, they have contracts
signed with auto producers, which pay good money for the material. As a result,
there is not much material left to export,” a trader commented.

The demand in the local market has been resilient recently, with the prices gaining
$3-5.5/t on the week. Sources say that the consumption is mostly driven by auto
makers, but other producers have also somewhat increased purchases due to low
stocks.