SMM Daily Comment On Domestic HRC Market (Sep 11)

SHANGHAI, Sep 11(SMM) – HRC futures prices rebounded slightly and closed at 3851 yuan/mt, an increase of 0.21%. Today, HRC quotations in mainstream cities’ spot markets rose by 10-40 yuan/mt. From the demand side, short-term downstream order volume changed little. The terminal procurement is difficult to see substantial improvements. Besides, it will take time for the effects of recent policies to benefit real estate and manufacturing. According to the latest SMM survey, steel mills were highly motivated to produce HRC. The average daily production schedule in September increased by 1.12% MoM. Oversupply pressure will persist. And limited downside room in iron ore prices and firm coke prices will offer solid cost support to steel prices. Therefore, HRC prices will see limited downside or upside room.