SHANGHAI, Aug 21 (SMM) –
HRC futures prices closed up 0.13% at 3,905 yuan/mt. HRC prices appeared stable-to-higher this week. Trading sentiment picked up with terminal demand. Pressure of supply lingered, while build-up in inventory significantly slowed down. In the follow-up, in spite of scheduled maintenance of some steel mills in the southwest China next week, high HRC supply may remain, owing to current high enthusiasm for production and shipments by steel mills in northern China next week. On the demand side, terminal demand softened, and downstream buyers were in a cautious mood. Demand is unlikely to improve significantly, while inventory in Shanghai market will be at a historically high level. On the cost side, with uncertain implementation of policy on crude steel production limit and good profits, steel mills had great incentive to produce, thereby making for bullish iron ore market. Despite news of coke price slip this week, costs of HRC moved up as a whole. The 2310 contracts of HRC may fluctuate strongly at 3,850-4,050 yuan/mt, driven by the strength of iron ore. HRC prices will swing in the range of minus 100 yuan/mt to plus 100 yuan/mt.
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