China's export prices of hot-dip galvanized and cold-rolled coils converge in ASEAN

The export price of hot-dip galvanized steel originating in China is approaching the price of cold-rolled coil in Southeast Asia. This price distortion occurred when the Russian Ukrainian war interrupted the supply of steel and raw materials.

The quotation of annealed and cold rolled 1mm base material thickness coil of lower grade steel mills in China is currently 980 US dollars / ton CFR Manila. According to Philippine traders, the quotation for hot-dip galvanizing of Z80 1mm substrate is also 980 US dollars / ton CFR Manila. A Manila trader said that these quotations come from Chinese private steel mills and will be delivered in May / June. A Chinese trader quoted 930 US dollars / ton fob for the export of annealed cold-rolled coil and 970-980 US dollars / ton fob for the export of z120 hot-dip galvanizing. The freight from China to Manila is about 35-40 US dollars / ton.

The price of hot-dip galvanizing peaked at US $1020 / ton CFR, which lasted less than a week before China's steel futures fell in early March. At that time, the export price of cold rolled coil in China was 950-960 US dollars / ton CFR. With the outbreak of China's COVID-19 and the consequent closure measures, the price of hot dip galvanized export decreased, while the price of cold rolled coil increased slightly. This may be due to the shortage of hot rolled coil and slab in Europe.

Prices peaked for HDG at $1,020/t cfr, lasting for less than a week before the correction in Chinese steel futures in early March. At that time, Chinese CRC export prices were at $950-960/t cfr. With Covid-19 outbreaks and accompanying lockdowns in China, HDG export prices fell, whereas CRC prices lifted slightly, probably amid shortages of hot rolled coil and slab in Europe.

The trader believed that the trading of plate products was quite slow this week due to concerns about further disruption in the Chinese market and rising prices. Another trader said that the Philippine buyer did not buy cold-rolled coils, but had concluded several hot-dip galvanizing transactions at US $960 / ton CFR Manila. The price of SS400 hot rolled coil with thickness of 3-12mm in China has dropped to US $900 / ton CFR Manila.

In Vietnam, the domestic price has risen. The ex factory price of annealed cold-rolled 1mm coil is equivalent to about 1000 US dollars / ton, and the ex factory price of z120 1mm substrate hot-dip galvanizing is equivalent to about 1180 US dollars / ton. "Demand is still poor," said a Vietnamese trader He added that users only buy when they get the project, and not in large quantities.