As of January 29, average Chinese domestic rebar and wire rod prices have indicated a rising trend compared to last week amid increasing rebar futures prices, following news about the reserve requirement ratio (RRR) cut.
The average rebar price has risen by RMB 37/mt ($5.2/mt) compared to January 22, while the average 6.5 mm HPB 300 wire rod price has seen an increase of RMB 43/mt ($6.1/mt). Rebar prices have remained stable compared to Friday, January 26.
During the given week, rebar and wire rod prices in the Chinese domestic market have seen slight rises amid increasing rebar futures prices. The People’s Bank of China has officially announced that the reserve requirement ratio (RRR) will be cut by 0.5 percentage points on February 5, which will release RMB 1 trillion ($139 billion) in long-term liquidity to the market, bolstering market sentiments and exerting a positive impact on rebar and wire rod prices. Since the Chinese New Year holiday (February 9-16) is drawing closer, stocks of rebar and wire rod have shifted from steelmakers to traders, signaling that stock replenishment is continuing, providing some support for the market. At the same time, the high iron ore prices have also supported rebar and wire rod prices from the cost side. However, construction sites have gradually started to halt activities, which will slacken demand further. It is expected that rebar and wire rod prices in the Chinese domestic market will likely move sideways in the coming week.
On January 29, rebar futures contract (rb2405) offers closed at RMB 3,968/mt ($559/mt) at Shanghai Futures Exchange, increasing by RMB 66/mt ($9.3/mt) or 1.7 percent compared to January 22, while decreasing by 0.08 percent compared to the previous trading day.
Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.
Rebar prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price |
Weekly change |
Weekly change |
|
25 - HRB400 |
Beijing |
3,880 |
545.7 |
40 |
5.7 |
|
Guangzhou |
4,250 |
597.7 |
20 |
2.9 |
|
|
Shanghai |
3,930 |
552.7 |
50 |
7.1 |
|
|
Average price |
4,020.0 |
565.4 |
37 |
5.2 |
All prices include 13 percent VAT and all prices are ex-warehouse.
Wire rod prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Weekly change |
|
6.5 - HPB300 |
Beijing |
4,500 |
632.9 |
40 |
5.7 |
|
Guangzhou |
4,570 |
642.8 |
30 |
4.3 |
|
|
Shanghai |
4,530 |
637.1 |
60 |
8.5 |
|
|
Average price |
4,533.3 |
637.6 |
43 |
6.2 |
|
|
8 - HPB300 |
Beijing |
4,320 |
607.6 |
40 |
5.7 |
|
Guangzhou |
4,510 |
634.3 |
30 |
4.3 |
|
|
Shanghai |
4,230 |
594.9 |
60 |
8.5 |
|
|
Average price |
4,353.3 |
612.3 |
43 |
6.2 |
All prices include 13 percent VAT and all prices are ex-warehouse.
$1 = RMB 7.1097