Bearish moods have returned in the Asian wire rod market with some major suppliers voicing lower offers and demand in Asia has remained poor overall. This has happened even though from Friday the Chinese market will be closed for a long holiday.
Offers for ex-China wire rod from second-tier mills and traders have been heard at $510-540/mt FOB, edging down by $5/mt compared to September 21, with the lower end of the range losing $10/mt. Some suppliers have been trying to accelerate sales ahead of the holidays.
“During the given week, stock replenishments have not been as good as expected in China, and demand for wire rod has failed to show a strong performance during the so-called peak season. The gap between supply and demand may widen, which will weaken the support for the wire rod market,” a Chinese trader said.
Offer prices of ex-Indonesia and ex-Malaysia wire rod have been heard at $520-530/mt FOB. Though last week an Indonesian mill was trying to push offers to $530-535/mt FOB, from Monday its official level slipped to $530/mt FOB and market sources said that the tradable level is now $520-525/mt FOB.
The real estate industry in Southeast Asia remains sluggish, exerting a negative impact on the wire rod market. The import wire rod price levels have remained at $520-535/mt CFR.
As of Thursday, September 28, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,690/mt ($514/mt), decreasing by RMB 72/mt ($10/mt) or down 1.9 percent since September 21, while increasing by 0.16 percent compared to the previous trading day (September 27).
$1 = RMB 7.1798