Chinese long product prices on stable course

SteelOrbis Shanghai Chinese long product prices remained stable throughout last week with slight rebound in northern and southern China market, while the eastern China market continuing the downward trend. Experiencing a continuous sharp decrease earlier, China's long products market saw slight fluctuations last week with different market performances all over the country. Influenced by the sluggish commercial activity, eastern China market prices continue to go down, but the traders are not panic any more. After the sharp decline in Beijing market, the traders' inventory saw a rapid decrease as the supply slid to other markets. Then, the prices saw a slight rebound and remained stable in the second half of the week. Shaoguan Steel, the leading local steel mill in Guangzhou market slightly raised its ex-factory price and supported the market prices, while some medium and small traders began to wait for further price increase with many products in their stocks. However, since the typhoon and continuous rain influenced the demand in southern area of China, the prices went back into the downward trend in the second half of the week. Market in eastern China is at the bottom level with little decrease range, while there is still some decrease range for markets in northern and southern China. On product basis, there is little margin for HRB335 rebar price to go down, while HRB400 and Q235 wire rod prices may still continue falling. According to the latest figures released by CISA, the rebar production in June totaled 7.0707 million mt, up 29.4 percent month on month, wire rod totaled 6.3259 million mt, up 23.6 percent month on month, with evidently higher growth compared with the previous month, which is one of the main reasons that caused the sharp decline in long products prices from the middle of June. Chinese long product prices are expected to fluctuate in a small range next week, with a possible decline in both Beijing and Guangzhou.