The Chinese domestic longs market trended up rapidly during the first half of the past week, but then slid down in the latter part of the week.
Product | Size | Grade | Average price (RMB/mt) | Price ($/mt) | Weekly change ($/mt) |
6.5 mm | Q235 | 4,213 | 618 | +20 | |
20 mm | HRB 335 | 4,117 | 604 | +20 | |
20 mm | HRB 400 | 4,260 | 625 | +22 |
In China's three main steel markets, i.e., Shanghai, Beijing and Guangzhou, the prices of Q235 grade 6.5 mm size high speed wire rod now respectively stand at RMB 4,150/mt ($609/mt), RMB 4,280/mt ($628/mt) and RMB 4,210/mt ($617/mt), with HRB 335 grade 20 mm rebar prices respectively at RMB 3,910/mt ($573/mt), RMB 4,280/mt ($628/mt) and RMB 4,160/mt ($610/mt). Meanwhile, HRB 400 grade 20 mm rebar is priced at RMB 4,000/mt ($587/mt), RMB 4,380/mt ($642/mt) and RMB 4,400/mt ($645/mt) in the respective markets. All prices are ex-mill, including17 percent VAT.
In the context of rumors of imminent strong iron ore price increases by the global mining giants, the Chinese domestic longs market has been on an impressive rising trend in the last couple of weeks. However, observing some signs of weakness in sales activities in the past week, many local mills started to sell off their stocks. Thus, given the increasing supplies in the market, prices entered a downtrend in the second half of the past week.
Market insiders have been worried that, as the recent price uptrend was not driven by any improvement in actual consumption, the increased market prices would probably lack support eventually. In addition, the decreases in the rebar futures market have significantly influenced the mood of players in the stock market.
During the week in question, wire rod and rebar inventories mostly posted declines in the main Chinese cities.
It is expected that market prices will climb up in the coming period if domestic mills continue to raise their prices.