SMM HRC Market Review and Forecast

SHANGHAI, May 25 (SMM) - HRC futures closed down by 1.78% at 3,532 yuan/mt today. Spot quotes diverged in mainstream Chinese markets, and the overall transaction was poor. HRC output dropped 12,300 mt in total this week due to multiple factors such as steel mills’ maintenance.  Market supply in central China, south China and north China all dropped to varying degrees. The downstream demand also decreased. In north-east and east China markets, the supply grew, but the end demand could barely improve. The pessimism spread across the market today. But the profit-making steel mills did not cut their production on a large scale. In terms of raw materials, the coke prices have fallen for the ninth rounds. SMM presumes that the HRC prices will drop in the near term.