The expectation is that the price for HRC will remain low at the current level until the end of this year while the steel production of finished products at EAF steel mills will gradually reduce at the end of this year due to weak demand from end users. Local HRC prices in China fell substantially in one week as a result of weak domestic demand and a reduction in HRC futures. Clients are reducing their bookings of Japanese scrap as a result of assistance from the completed business market, and production at EAF steel mills in scrap import nations such as Vietnam and Korea is declining.
Let us support and share with you in this blog your business decision during this down-trend market around the world closing 2022.
China
Domestic HRC prices in China declined sharply by RMB 150/t ($21/t) in one week to RMB 3,720/t ($514/t) on Oct 28th due to weak domestic demand and the drop of HRC's future. China's HRC export offers were heard at $575/t FOB China, slightly down by $5/t from a week ago. Similarly, steel billet prices in China fell sharply by RMB 100/t ($14/t) week on week to RMB 3,510/t ($484/t), including 13% VAT.
Japan
One of D-Bar Steel Producers has announced that they will increase their price by JPY 10,000/t ($ 68/t) from the NOV's contract. Steel scrap suppliers in Japan maintained the scrap prices high despite low demand from the domestic and overseas markets. H2 scrap export prices stand at JPY 50,000/t ($340/t) FOB, moving up by JPY 500/t in one week and hitting the highest level in one month. Buyers are slowing down their bookings of Japanese scrap amid a lack of support from the finished steel market and slowing down production at EAF steel mills in scrap import countries like Vietnam and Korea.
Europe
European HRC prices were stable in a low-demand market on Oct 26th amid buyers saying they have high stock while producers plan to reduce production output to stop the price from falling. The price of HRC in Northern Europe was at €666/t ($660/t) Ex-works, down just by €4/t from a week earlier.
America
HRC prices in the US remained stable at $836/Mt ($760 per short ton) week on week but the pressure is building up on the spot price due to different price offers from different mills. Steel mills were well aware of a possible recession and lackluster demand so they tried to secure quantity booking for next year via contract agreements.
Brazillian steel plate is offering to Europe at $560/t FOB Brazil ports, the same rate as last week, and equivalent to $630/t CFR Europe with freight fixed at $70/t. Similarly, Brazil's sales to the US and Mexico also at $560/t FOB in the week ended Oct 28th.
Viet Nam
Many steel companies in Vietnam suffer from high inventory and slow sales due to weak demand for finished long steel products from domestic and overseas markets. As the result, demand for imported scrap is very low when steel mills have cut their production and are running below 50% capacity. Japanese bulk H2 scrap offer to Vietnam was heard at around $385/t CFR level.
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