Chinese hot rolled coil prices slumped last week, alongside rebar prices, to 20-month lows despite its demand being slightly higher than a year ago.

Despite higher demand than a year earlier, China’s HRC production remains strong and inventories saw negligible losses last week. Therefore, prices kept falling for five days last week and the speed even accelerated on Friday when short positions were actively closing.

Chinese HRC prices thus touched the lowest level since July 2022. This is also the second lowest since the price range of Chinese HRC increased significantly in early 2020 after the outbreak of Covid-19.

Slumping domestic prices also hit export markets and caused chaos. While Chinese prices kept falling, buyers were not willing to purchase and were decreasing their price targets. Mills and traders still tried to quickly lower Q195/SS400 HRC offers to export markets.

some traders gave quotations for Q195 HRC at less than $520/t cfr Vietnam. The most competitive offers dropped to $508-510/t on Thursday, and $500-505/t on Friday. “Small [Chinese] mills are messing up [the market],” a Vietnamese trader commented on Friday, "and I heard offers below $500/t cfr Vietnam."

SAE 1006 HRC exports are not the current focus of most traders. Limited offers were around $550-555/t cfr Vietnam, and $570/t cfr Gulf Cooperation Council area. These are for May shipment, and are dozens of dollars lower than Indian offers.