Price Trends

According to the commodity market analysis system of SunSirs, the domestic market for color coated sheets remained generally stable last week with minimal fluctuation; mainstream quotes remained essentially unchanged, with room for price negotiation of only 10–20 RMB/ton in certain regions. The market price stood at 6,500 RMB/ton on both June 8 and June 12, indicating a stabilization compared to the week prior to last, though the price was down 1.515% year-on-year.

Analysis and Commentary

Galvanized Sheet: Prices for galvanized sheet saw a slight decline last week; as of Friday (June 12), the price stood at 4,200 RMB/ton, down 0.355% from the week before last but up 2.065% year-on-year. Downstream demand in the coated sheet market remained tepid, resulting in sluggish trading activity.

Cost side: Weak support, slight margin compression

Last week, cost support showed signs of weakening despite remaining relatively stable; while steel mills maintained a price floor, the scope for a sharp decline was limited.

Cold-rolled/galvanized substrates: Prices retreated slightly; a softening in Tangshan feedstock prices reduced support for finished products.

Zinc ingots and coatings: Prices remained stable with minimal fluctuation in auxiliary materials, leading to a slight decline in overall costs.

Steel mill margins: Processing margins contracted slightly but remained within a safe range, with no pressure from losses.

Supply side: High operating rates, ample supply

Supply remains ample, steel mills are maintaining normal production schedules, and inventory levels are neutral with no pressure.

Operating Rate: The operating rate for color coated steel lines is approximately 84%, holding steady compared to the previous week, with no major maintenance shutdowns.

Production Volume: Average daily output is around 36,200 tonnes, ensuring sufficient supply.

Inventory: Inventories held by steel mills and traders have seen a slight build-up; turnover is steady, with no significant overstocking or shortages.

Demand side: Weak during the off-season; photovoltaics stood out as the only bright spot

The characteristics of the traditional off-season are pronounced; the market is driven primarily by essential demand, trading is sluggish, and demand patterns are increasingly divergent.

Construction: The combination of the rainy season in the south and the off-season has hindered outdoor construction; orders for factory buildings and building envelope systems have declined, leading to a drop in procurement volumes.

Home Appliances: During this traditional off-season, orders for refrigerators and air conditioners remain lackluster; procurement is dominated by small, essential orders, with no significant bulk restocking.

Photovoltaics/New Energy: Essential demand remains robust for rooftop PV installations, new energy manufacturing facilities, and cold-chain equipment; transactions for premium, highly weather-resistant materials remain steady, serving as a key pillar of market support.

Procurement Patterns: Low inventory levels prevail across the market; there is no stockpiling, with restocking conducted strictly on an as-needed basis, while traders focus on rapid inventory turnover.

Futures and Sentiment: Market Volatility; Wait-and-See Stance Prevailed

Futures prices for ferrous products (hot-rolled coils and cold-rolled sheets) are fluctuating within a narrow range amidst a standoff between bulls and bears, offering no clear direction for the spot market.

SHFE zinc prices are seeing minimal fluctuation, with limited impact on the galvanized and color coated sheet sectors.

Market sentiment is cautious and conservative; a mix of price-propping and inventory-clearing strategies prevails, and a "wait-and-see" atmosphere dominates, with no clear expectations for significant price increases or decreases.

Market Outlook:Barring significant fluctuations in costs, mainstream prices for color coated sheets are unlikely to see sharp rises or falls, with minor fluctuations expected to be the norm.

In summary, current prices for color coated sheets are hovering around the midpoint of the annual range and remain relatively stable; consequently, prices could either rise or fall in the short term.

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