Ex-Asia wire rod prices have posted some limited decreases over the past week amid the slack demand from buyers in Southeast Asia and locally in China. However, the market is expected to stablize at the current levels.
Offers for ex-China wire rod have been heard at $495-500/mt FOB, down $2.5/mt on average compared to July 30. The tradable prices are heard at $490-495/mt FOB at the lowest, mainly for the regional market.
During the given week, the production of wire rod has been at relatively high levels as steelmakers have not yet significantly expanded their maintenance plans. In the traditional off-season amid the widespread high summer temperatures, demand for wire rod has been sluggish, resulting in continuous oversupply, which has exerted a negative impact on prices. Recently, coke prices have indicated three rounds of declines, weakening the support for wire rod prices from the cost side. However, rumors of production restrictions on coke have pushed up coke futures prices since August 5, which will bolster wire rod prices firmly. It is thought that wire rod prices in the Chinese domestic market will fluctuate within a limited range in the coming week.
Wire rod offer prices from Indonesia's Dexin Steel are at $475/mt FOB for September shipment, down $5/mt over the past week.
In Southeast Asia, mainstream tradable prices of 6.5 mm SAE1008 wire rod have been heard at $500/mt CFR, decreasing by $5-10/mt compared to last week. Buyers are asking for $490-495/mt CFR, but it is unlikely that exporters will accept this.
As of August 6, rebar futures at Shanghai Futures Exchange are standing at RMB 3,014/mt ($444/mt), remaining stable since July 30, while up 0.97 percent compared to the previous trading day, August 5.
$1 = RMB 6.7895
