Average offer prices for ex-China wire rod have moved sideways compared to the previous week due to slack demand during the rainy season in eastern China. Southeast Asian wire rod suppliers have not been prepared to cut prices further and have been offering at slightly higher levels amid strong raw material prices and increased freight rates.
Offers for ex-China wire rod have been heard at $850-870/mt FOB, moving sideways on average compared to the previous week amid the prevailing cautious sentiments during the traditional offseason. “The traditional offseason in eastern China has exerted a negative impact on demand for wire rod in the local market, while the Covid-19 pandemic in Southeast Asia has also hit buyers’ sentiments,” an international trader said.
Though production restrictions bolstered prices to some extent in China, the demand for wire rod has slackened in the summer, weakening support for prices. The relatively stable trend of local wire rod prices has affected ex-China wire rod prices, which have also moved sideways in the given week, with deals mostly possible only to South America and South Korea.
Offer prices of ex-Southeast Asia wire rod have been heard at $770/mt CFR minimum, versus $760-770/mt CFR, while buyers have stayed away from imports.
As of June 18, rebar futures at the Shanghai Futures Exchange are standing at RMB 5,061/mt ($786/mt), decreasing by RMB 261/mt ($40.6/mt) or 4.9 percent since June 11.