Uptrend in local Chinese longs market continues, though in slower pace

As of November 13, average Chinese domestic rebar and wire rod prices have moved up further compared to the previous week amid continued rises in futures prices, though demand has been uneven in different parts of the country and the cold weather together with the increase in stocks may result in smaller fluctuations in longs prices.

The average rebar price has increased by RMB 60/mt ($8.4/mt) compared to November 6, while the average 6.5 mm HPB 300 wire rod price has seen a rise of RMB 47/mt ($6.5/mt). Rebar prices have risen by RMB 16/mt ($2.2/mt) compared to November 10.

During the given week, rebar and wire rod prices in the Chinese domestic market have continued their uptrend, though the rising pace has slowed down as some market players chose to leave the market to lock in profits. Demand in northern China has slackened further due to the cold weather negatively affecting construction activities. In southern China, some projects have sped up construction activities, which has exerted a positive impact on demand, though this may not continue in the long term. The declines in inventory levels of rebar and wire rod are anticipated to diminish, which will weaken the support for prices. It is thought that rebar and wire rod prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week.

On November 13, rebar futures contract (rb2401) offers closed at RMB 3,872/mt ($539/mt) at Shanghai Futures Exchange, increasing by RMB 67/mt ($9.3/mt) or 1.76 percent compared to November 6, while rising by 0.05 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

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 7.178