During the week ending June 18, average Chinese domestic rebar and wire rod prices have moved down by more than $30/mt on average amid the sharp declines in rebar futures prices, weak demand and the negative outlook for the coming weeks.
During the given period, the average rebar price has lost RMB 203/mt, while the average wire rod price has dropped by RMB 157/mt. Following gradual decreases over the last week, a significant decline has been seen in the market today, June 21, with the rebar price falling by RMB 90/mt or $14/mt since Friday.
In the given week, big decreases in rebar futures prices have negatively affected rebar and wire rod prices, reversing the rebounding trend since the Dragon Boat Festival. On June 21, rebar futures contract (2105) offers closed at RMB 4,889/mt ($757/mt) at Shanghai Futures Exchange, down RMB 279/mt ($43.2/mt) or by 5.4 percent compared to June 15, signaling market players’ bearish sentiments as regards the future prospects for the rebar market amid slack demand in the traditional offseason.
The celebration of the 100th anniversary of the founding of the Communist Party of China will take place on July 1 and market sources expect construction works and steel production will be temporarily reduced ahead of the event. This will limited demand, which has already been weak recently, but supply of rebar may also see some reduction in the near future.
Moreover, today’s sharp decline in iron ore prices, following the National Development and Reform Commission’s announcement of the launch of an investigation into the high raw material prices in the country, has also put pressure on local rebar prices. Iron ore fines with 62 percent Fe content have lost $12/mt today compared to Friday, coming to $204/mt CFR, according to SteelOrbis’ data.
Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.
Rebar prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price |
Weekly change |
Weekly change |
|
25 - HRB400 |
Beijing |
4,950 |
766.8 |
-280 |
-50.9 |
|
Guangzhou |
5,000 |
774.6 |
-220 |
-41.5 |
|
|
Shanghai |
4,900 |
759.1 |
-110 |
-24.2 |
|
|
Average price |
4,950.0 |
766.8 |
-203 |
-38.9 |
All prices include 13 percent VAT and all prices are ex-warehouse.
Wire rod prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Weekly change |
|
6.5 - HPB300 |
Beijing |
5,930 |
918.7 |
-220 |
-42.9 |
|
Guangzhou |
5,420 |
839.7 |
-130 |
-28.1 |
|
|
Shanghai |
5,390 |
835.0 |
-120 |
-26.5 |
|
|
Average price |
5,580.0 |
864.4 |
-157 |
-32.5 |
|
|
8 - HPB300 |
Beijing |
5,710 |
884.6 |
-220 |
-42.6 |
|
Guangzhou |
5,360 |
830.4 |
-130 |
-28.0 |
|
|
Shanghai |
5,340 |
827.3 |
-120 |
-26.4 |
|
|
Average price |
5,470.0 |
847.4 |
-157 |
-32.3 |
All prices include 13 percent VAT and all prices are ex-warehouse.
$1 = RMB 6.4546