HRC Exports to Surge in Recent Months on Better Profitability

SHANGHAI, Feb 10 (SMM) - The sales of hot-rolled coils in Chinese market are estimated at 12.82 million mt in February, with a daily average sales volume of 457,700 mt, up 15,400 mt or 3.48% from the realised daily average output of 442,300 mt in January. Recently, as overseas inflation has gradually pivoted, and after the domestic pandemic prevention and control measures are relaxed, the upstream and downstream of the industrial chain have strong expectations for the economic and consumption recovery in 2023, and the steel mills are relatively enthusiastic in producing HRC. In addition, due to the mismatch of supply and demand overseas, Chinese steel stands out with a palpable price advantage, and the export profit still outperforms that of domestic sales, which has encouraged the steel mills to export. Collectively, the domestic average daily delivery volume of HRC in February is likely to increase slightly compared with that in January.

The export volume of HRC is estimated at 875,000 mt in February, up 354,000 mt or 67.95% from the actual export volume in January. According to SMM research, starting from January, many steel mills reported that the export window opened as the overseas steel prices continued to rise. Coupled with better export profits, the steel mills have put more efforts on the export market, and the delivery has been scheduled to March the latest. According to SMM research, the cargoes are mostly scheduled to be shipped in March and April, hence SMM expects the export volume of steel will surge in the next two months.