SMM Daily Comment On Domestic HRC Market (Sep 19)

SHANGHAI, Sep 19 (SMM) – HRC futures fluctuated upward and closed at 3,933, an increase of 1.31%. In terms of spot prices, HRC quotations in mainstream areas rose slightly. According to SMM statistics, this week, the output reduction of pig iron caused by the blast furnace maintenance is estimated to be 906,000 mt, an increase of 47,600 mt from the previous week. In terms of HRC, the output reduction caused by maintenance this week is estimated to be 101,900 mt, a decrease of 47,200 mt WoW, and that of next week will be 67,200 mt, a decrease of 34,700 mt WoW. With the impact of maintenance fading, the pressure of oversupply appeared again. Products with low quotations could be shipped, indicating firm rigid demand. Entering the restocking period before the National Day, demand didn’t witness obvious growth. In terms of raw materials, supply and demand were tightly balanced, promoting coke enterprises’ strong willingness to raise prices. The short-term fundamental imbalance of iron ore had not yet fully emerged. High costs supported the upward movement of HRC prices, but actual weak demand limited its room for growth. In the short term, HRC prices are estimated to oscillate.