As of May 22, average Chinese domestic rebar and wire rod prices have continued their downtrend compared to May 15, taking into account weak real estate data and continuing worries over demand in the near future, which may still recover slower than supply.
The average rebar price has decreased by RMB 53/mt compared to May 15, while the average 6.5 mm HPB 300 wire rod price has declined by RMB 60/mt. Rebar prices have seen a decline of RMB 44/mt compared to last Friday.
At the beginning of the given week, rebar and wire rod prices in the Chinese domestic market moved up first, while they moved down later amid the poor performance of China’s economic data in April. In the January-April period this year, total real estate investments in China dropped by 6.2 percent year on year, faster than the 5.8 percent decline in the January-March period. Also, the new area covered by construction activity continued to show a double-digit drop, falling by 21.2 percent year on year in the given period, versus 19.2 percent in Q1. Even though market sources are expecting some government measures to support the real estate sector, any measures are expected to be gradual and will not lead to a rapid reverse in the current situation.
The demand for rebar and wire rod has been slack in China, while this will likely continue due to rainy weather in the coming week. At the same time, production of rebar and wire rod has indicated slight rises week on week. Moreover, coke prices have moved down further, weakening the support for rebar and wire rod prices from the cost side. It is thought that rebar and wire rod prices in the Chinese domestic market will likely edge down further in the coming week.
On May 22, rebar futures contract (rb2210) offers closed at RMB 3,569/mt ($509/mt) at Shanghai Futures Exchange, decreasing by RMB 98/mt ($14/mt) or 2.7 percent compared to May 15, while decreasing by 2.35 percent compared to the previous trading day.
Average domestic rebar and wire rod prices in China's main markets are presented in the tables below:
Rebar prices in local markets
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price |
Weekly change |
Weekly change |
25- HRB400 |
Beijing |
3,700 |
527.4 |
-30 |
-8.2 |
Guangzhou |
3,840 |
547.3 |
-60 |
-12.6 |
|
Shanghai |
3,630 |
517.4 |
-70 |
-13.8 |
|
Average price |
3,723.3 |
530.7 |
-53 |
-11.5 |
All prices include 13 percent VAT and all prices are ex-warehouse.
Wire rod prices in local markets
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Weekly change |
6.5 - HPB300 |
Beijing |
4,330 |
617.2 |
-30 |
-8.8 |
Guangzhou |
4,110 |
585.8 |
-80 |
-15.8 |
|
Shanghai |
4,230 |
602.9 |
-70 |
-14.5 |
|
Average price |
4,223.3 |
602.0 |
-60 |
-13.0 |
|
8 - HPB300 |
Beijing |
4,150 |
591.5 |
-30 |
-8.6 |
Guangzhou |
4,050 |
577.3 |
-80 |
-15.7 |
|
Shanghai |
3,930 |
560.1 |
-70 |
-14.2 |
|
Average price |
4,043.3 |
576.3 |
-60 |
-12.8 |
All prices include 13 percent VAT and all prices are ex-warehouse.
$1 = RMB 7.0157