Average offer prices for ex-China wire rod have moved sideways compared to the previous week amid the decreasing output from Chinese steelmakers and despite weaker sentiment in the local market in China. Price levels for wire rod from Vietnam and Indonesia have remained high.
Offers for ex-China wire rod have been heard at $640-670/mt FOB with a midpoint at $655/mt FOB, moving sideways compared to the previous week. “Inventory of wire rod in the Chinese domestic market has seen rises, while steel mills have reduced their outputs, providing support for wire rod prices, and the high levels of scrap prices in the international market have bolstered wire rod prices in the export market,” an international trader said.
Offer prices of ex-Vietnam and ex-Indonesia wire rod have been heard at $680-685/mt FOB and some even at $700/mt FOB, though the tradable price level has been not above $670/mt FOB.
The Covid-19 pandemic has worsened in China, exerting a negative impact on construction activities and resulting in slacker demand for wire rod. Approaching the Chinese New Year holiday (February 11-17), more control measures will be implemented to reduce the possibility of the spread of the pandemic.
As of Thursday, January 14, rebar futures at the Shanghai Futures Exchange are standing at 4,294/mt ($6663/mt), decreasing by RMB 161/mt ($10.4/mt) or 3.6 percent since January 7, while increasing by 0.05 percent compared to the previous trading day.
$1 = RMB 6.4746