Chinese: HRC offers to ME range-bound w-o-w in muted trade

China's hot-rolled coil (HRC) (grades S235 and S275) export offers to the Middle East (ME) remained range-bound w-o-w with offers hovering at $490-500/t CFR UAE. Despite the stability in offers, trading in Chinese HRCs in the ME remain limited, suggesting weak demand.

China's Shanghai Futures Exchange (SHFE) HRC futures rose by RMB 45/t ($6/t) d-o-d to RMB 3,235/t ($460/t) against RMB 3,190/t ($454/t) a day ago. Moreover, on w-o-w basis, the same edged up by RMB 19/t ($3/t) w-o-w as compared to RMB 3,216/t ($457/t) on 18 September. The upcoming Golden Week holidays in China, from 1-7 October, has improved domestic HRC demand in China, potentially leading to increasing prices and reduced export offers.

Moreover, imported HRC offers from Japan to ME stood at $490/t CFR UAE. A deal of around 25,000 tonnes (t) was heard concluded for November shipments. However, Indian mills have continued to hold there HRC export offers to the ME.

Outlook

The short-term outlook in relation to Chinese HRC exports to the ME appears positive, supported by the Golden Week holidays and competitive pricing from Japanese imports. A recent deal suggests some buying interest but, overall, demand may be limited due to the ongoing instability and geopolitical issues.