Offer prices for ex-China wire rod have moved down over the past week amid the decreasing rebar futures prices, which have declined by $25/mt over the past week. This has triggered negative sentiment in Asia and ASEAN mills have also had to cut prices, though they are still at higher levels compared to a few Chinese exporters.
Offers for ex-China wire rod from second-tier mills have been heard at $450-470/mt FOB, decreasing by $10/mt on average compared to last week, At the same time, the reference deal prices have been heard at $455/mt FOB on average, also down by $10/mt week on week. During the given week, declining rebar futures prices have exerted a negative impact on the wire rod market, while bearish sentiments have prevailed among market players. Transaction activities have been quiet, weakening the support for the wire rod market. Market players are worried about the future trend of the steel market as they think there may be more room for downward movement.
However, “the continuous decreases in wire rod prices may ease the risks and leave room for a rally in the near future,” an international trader said.
Offer prices of Indonesia-based Dexin Steel’s wire rod have been heard at $465/mt FOB today, decreasing by $10/mt compared to last week. Some customers from distant markets received offers for ex-Indonesia wire rod at $470/mt FOB early this week and have been waiting for at least $460/mt FOB. Offer prices of ex-Malaysia wire rod have already been heard at $460/mt FOB, while offer prices of ex-Vietnam Hoa Phat have been heard at $475/mt FOB, decreasing by $15/mt on average.
In Southeast Asia’s import wire rod market, the price level for negotiations with Chinese traders has fallen to $470-475/mt CFR, down by $10/mt from previous deals and $15-20/mt below the general offers seen last week when there was some slight optimism in the market. Ex-ASEAN offers in the region are at $480-485/mt CFR mainly, though customers are assessing the market as the downtrend has resumed.
As of September 5, rebar futures at Shanghai Futures Exchange are standing at RMB 3,083/mt ($434/mt), decreasing by RMB 176/mt ($25/mt) or 5.4 percent since August 29, while down 1.41 percent compared to the previous trading day, September 4.
$1 = RMB 7.0989
