Asian wire rod market strengthens amid higher demand and firm prices in China

Thursday, 21 November 2019 15:21:34 (GMT+3)   |   Istanbul
       

Sentiments in the Asian wire rod market have improved this week, and this has been reflected in higher prices for ex-Malaysia wire rod. Though ex-China prices have remained stable compared to last week, they have become more competitive.

SteelOrbis has been informed that offers for Malaysia-origin wire rod are currently at $475/mt CFR Philippines, $5-10/mt higher week on week.

Chinese export offer prices for wire rod from mills are still at $460-470/mt FOB. “Two Chinese mills have stopped providing prices for the export market this week due to the good situation in the local market. The workable level is $465/mt FOB,” a Chinese trader said. There is a rumor that some tonnages have been traded at this level this week.

“The decreases seen in inventory levels and better demand amid warm winter weather conditions provide a certain degree of support for wire rod prices,” another source said. Stronger demand in the local Chinese market has supported imports of wire rods into the country. Last week, there was a deal for ex-Malaysia wire rod at $450-455/mt CFR, about $10/mt above the previous deal price.

During the given week, China’s central bank took measures to inject liquidity into the market, which exerting a positive impact on market sentiment. Moreover, Hebei Province activated an orange alert for heavy air pollution from 18:00 on November 20, implementing strict emergency response measures (level two), thereby also boosting market sentiments. As of Thursday, November 21, rebar futures at the Shanghai Future Exchange are standing at RMB 3,619/mt ($515.5/mt), increasing by RMB 108/mt ($15.4/mt) or 3.1 percent since November 14. 

$1 = RMB 7.0217


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