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Bottom Prices of HR Coils Rise by around $70 for Aug Shipment
According to a Japanese mill source, in the export market of hot-rolled (HR) steel coils, bottom prices for August shipment seem to have risen by $70 from prices for June shipment. Chinese mills are offering prices exceeding $500 CFR for August shipment and are showing a bullish stance to raise their prices further. Such level in prices is raised by $70 or so from prices for June shipment.

Chinese mills are proceeding with full-fledged negotiations for August shipment. There are many cases that they revise their offer prices every week possibly due to a rise in domestic prices of HR coils. They offered markups of $20 for shipments of early July but it is reported that they concluded contracts at increased prices by $5-10 or so. However, they have gradually raised their offer prices and also contract prices.

Chinese mills are likely to have requested an increase in prices by $40 or so for August shipment. As they seem to raise their prices further for September shipment, the source is observing that there is a possibility for them to aim at $500 FOB. Due to a continuous increase in offer prices by Chinese mills, customers gave up spot purchases and have changed to normal ones. Contracted quantity is becoming large. If this goes on, bottom prices are likely to rise substantially.

Contrary to a bullish stance of Chinese mills, Korean mills appear to be proceeding with negotiations focusing on securing of quantity rather than an increase in prices. They are reported to have informed customers that if customers increase purchase quantity, they consider a decrease in prices to certain extent, which might disrupt a stance to raise prices of Chinese mills and so on. As Korean mills finished relining of blast furnaces and the periodic maintenance of hot-rolling facilities, they are reported to have made forced aggressive domestic sales. The source is seeing that Korean mills are reflecting such stance on the export market. Meantime, Korean mills have plans to conduct the periodic maintenance of other hot-rolling facilities from September, and if so, there is another view that their stance of sales may change.

Anyhow, bottom prices of HR coils are largely raised. To maintain such trend, the Japanese mills have to cooperate with a rise in prices of HR coils. They are offering an increase in prices by $30-50 for August shipment. Attention is paid to how they conclude contracts at prices as per offers.
last modified : Wed 12 Jul, 2017 [09:42]
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