Average offer prices for ex-China wire rod have moved sideways over the past week, setting the tone in the Asian wire rod market. Amid some limitations of supply and cost support, but with the seasonally weakening of demand, the market is expected to remain stable in the near future.
Offers for ex-China wire rod have been heard at $465-485/mt FOB, moving sideways on average compared to that recorded on July 31, where the second-tier mills have been offering at the lower end of the range and the large mills at the higher end of the range. The tradable prices have been heard at $460-475/mt FOB, also remaining stable on average from last week.
During the given week, heavy rains in some regions of China exerted a negative impact on construction activities, slackening demand for wire rod. The capacity utilization rates of wire rod producers have been at relatively low levels, bolstering prices to a certain degree. The safety inspections at coal mines have pushed up coal and coke prices, positively affecting wire rod prices from the cost side. As the military parade on September 3 is approaching, production halts will be strictly implemented in northern China, which will provide solid support for wire rod prices due to the anticipated decrease in supply. It is thought that wire rod prices in the Chinese domestic market may continue to fluctuate within a limited range in the coming week due to the ongoing high temperatures in southern China and heavy rains in several regions of China.
Wire rod offer prices from Indonesia’s Dexin have been heard at $495/mt FOB for October shipment, stable over the past week, though for some destinations like Europe they have been voiced at $500/mt FOB, as sellers hope for some rebound in this market when buyers come back from the holidays in late August.
Offer prices of ex-Malaysia SAE1006 wire rod have been stable at $470-480/mt FOB, and offers of ex-Vietnam CB300V-D6 wire rod have been heard at $535/mt FOB, increasing by $5/mt on average week on week.
In Southeast Asia, mainstream tradable prices of SAE1008 6.5 mm wire rod have been heard at $470-475/mt CFR, moving sideways on average week on week.
As of August 7, rebar futures at Shanghai Futures Exchange are standing at RMB 3,231/mt ($453/mt), increasing by RMB 26/mt ($3.6/mt) or 0.8 percent since July 31, while up 0.03 percent compared to the previous trading day, August 6.
$1 = RMB 7.1345