Average offer prices for ex-China wire rod have moved on an upward trend over the past week amid sharply increasing rebar futures and the gradual improvement in local demand in China, following the sharp price fall seen last week. ASEAN mills have also followed the upward movement.
Offers for ex-China wire rod from the second-tier mills have been at $465-475/mt FOB, increasing by $10/mt on average compared to last week, while reference deal prices have been heard at $465/mt FOB, also up by $10/mt week on week.
During the given week, production of wire rod has increased, while inventory levels have decreased, bolstering prices firmly. Wire rod producers’ profitability has improved amid declining raw material prices, while demand for wire rod is expected to rebound further in the traditional peak season of September, exerting a positive impact on market sentiments. The consumption of old-standard wire rod has continued smoothly. It is expected that wire rod prices in the Chinese domestic market will likely edge up in the coming week.
Offer prices for ex-Indonesia and ex-Malaysia wire rod have been heard at $470-475/mt FOB, increasing by $5-10/mt compared to last week, though some small discounts are possible. Offer prices from Vietnam’s Hoa Phat have been heard at $485/mt FOB, increasing by $10/mt on average.
In Southeast Asia’s import market, offers from the regional suppliers have reached $485-490/mt CFR, while the lowest level last week was $470-475/mt CFR.
As of September 12, rebar futures at Shanghai Futures Exchange are standing at RMB 3,185/mt ($447/mt), increasing by RMB 102/mt ($14.3/mt) or 3.3 percent since September 5, while up 3.11 percent compared to the previous trading day, September 11.
$1 = RMB 7.1214
