Local Chinese longs prices down further, second week after holiday starts negatively

As of February 26, average Chinese domestic rebar and wire rod prices have moved down compared to last week amid the decreasing trend of rebar futures prices and slack demand from downstream users. Sentiments have not improved on Monday, February 26, even though more players have returned to the market after the long holiday.

The average rebar price has decreased by RMB 63/mt ($8.9/mt) compared to February 19, while the average 6.5 mm HPB 300 wire rod price has seen a drop of RMB 60/mt ($8.5/mt). Rebar prices have edged down by RMB 20/mt compared to Friday, February 23.  

During the given week, rebar and wire rod prices in the Chinese domestic market have seen a downtrend amid the slack demand from downstream users. The inventory levels of rebar and wire rod have continued to increase, and this rising trend will likely continue in the near future. After the Lantern Festival on February 24, construction sites have gradually resumed their activities, which will positively affect the demand for rebar and wire rod, though demand may still lag behind supply. It is expected that rebar and wire rod prices in the Chinese domestic market will be soft this week, but they may edge up next week.

On February 26, rebar futures contract (rb2405) offers closed at RMB 3,749/mt ($528/mt) at Shanghai Futures Exchange, declining by RMB 59/mt ($8.3/mt) or 1.55 percent compared to February 19, while decreasing by 1.29 percent compared to the previous trading day (February 23).   

Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.    

Rebar prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

 Wire rod prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

$1 = RMB 7.108