Prices for ex-China wire rod have indicated an uptrend over the past week, supported by gradual improvement in demand in the local market.
Offers for ex-China wire rod from second-tier steel mills have been heard at $520-530/mt FOB, edging up by $15/mt on average over the past two weeks.
In the Chinese domestic market, downstream users’ purchasing activities for wire rod have not been as good as market players expected amid the prevailing cautious sentiments, while the increasing rebar futures prices bolstered wire rod prices. “Inventory of wire rod has been gradually consumed locally, which is a good sign, and we think wire rod prices in the Chinese domestic market will edge up slightly further in the coming week as demand will continue to improve,” an international trader said.
Indonesian Dexin's wire rod offers have been heard at $510-520/mt FOB, almost similar to $510/mt FOB reported last week. The producer cut its offers last week by $15/mt to accelerate sales and is likely to increase them more visibly from next week, as the pressure from unsold volumes has already eased. Offer prices for ex-Malaysia wire rod have been heard at $520/mt FOB and offer prices of ex-Vietnam Hoa Phat have been heard at $530/mt FOB.
Inventory level on Southeast Asian buyers’ side has been sufficient, thereby they mostly held a wait-and-see stance. The previous tradable level in SE Asia was $510-515/mt CFR, based on traders' offers and small deals. Market sources expect $520/mt CFR or higher from next week.
As of April 11, rebar futures at Shanghai Futures Exchange are standing at RMB 3,613/mt ($509/mt), increasing by RMB 132/mt ($18.6/mt) or 3.8 percent since March 28, while up 0.75 percent compared to the previous trading day, April 10.
$1 = RMB 7.0968