The export market for Chinese hot-dip galvanized coil has yet to awaken following the country’s Lunar New Year holiday break, traders said Thursday. Only scattered deals have been done over the past few days, sources said.
On Thursday offers for 1.0mm DX51D HDG with 80 gram/square meter zinc coating were around $665-670/metric ton FOB Shanghai, unchanged from pre-holiday levels. Platts assessed tradeable prices for the same grade of HDG at $660-665/mt FOB, unchanged from the previous assessment undertaken on January 9.
A mid-tier mill in northern China was quoting 1.0mm HDG with 80g/sm zinc coating at $665/mt FOB, with an official saying transaction prices were around that level. Another two mills in north China which stopped quoting ahead of the holiday were keeping their offers unchanged as well, Platts noted.
Several traders quizzed by Platts said business was slow recently as buyers were waiting on sidelines given the bleak outlook painted for the market. A Shanghai-based trader confirmed he was yet to start quoting.
Some mills, anticipating a round of price increases after China returned to work, stopped offering before holidays in anticipation. However, the weak domestic market since late last week, in tandem with the slowdown in enquiries from abroad, capped the upward momentum and led the producers to leave their prices unchanged, a Shanghai-based trader said.
Despite the halt in export business, a major trader in eastern China was hopeful of a price pick-up later. He noted that billet prices had started edging up since Tuesday, an improvement that might firm up other steel prices in tandem. In China when prices of longs rise, those of flats including HDG tend to follow in one to two weeks’ time, Platts notes.
© Steel Business Briefing 2012
