Chinese longs prices almost stable as weather improves, but futures decline

During the week ending July 27, average prices of Chinese domestic rebar and wire rod have not changed much, just posting minor increases. The average local rebar price has added RMB 3/mt, while the average local wire rod price has increased by RMB 20/mt, week on week.  

During the given week, rebar futures prices moved up sharply first but edged down later, affecting rebar and wire rod prices in the spot market. Meanwhile, the inventory of rebar and wire rod has increased, exerting a negative impact on prices. Steelmakers in Guangdong and Hebei which had halted production previously started to resume production, which will increase the supply of rebar and wire rod in the coming period. The rainy weather in China has come to an end, positively influencing demand for longs, but several cities were still hit by floods. It is thought that rebar and wire rod prices in China will likely fluctuate within a limited range in the coming week.

On July 27, rebar futures contract (2010) offers closed at RMB 3,723/mt ($534/mt) at Shanghai Futures Exchange, up RMB 22/mt ($3.14/mt) or 0.6 percent since July 20, while rebar futures have indicated a decline of RMB 83/mt ($11.2/mt) over the past two trading days, reflecting some caution among market players.

Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.  

Rebar prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

 Wire rod prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

$1 = RMB 7.0029