Average offer prices for ex-China wire rod have remained stable over the past week and a few small deals have been reported to Southeast Asia at the low levels voiced since last week. At the same time, ASEAN-based mills, failing to sell any sizable volumes in the previous few weeks, have decided to cut prices sharply and this has already started to bring results.
Offers for ex-China wire rod have been heard at $540-560/mt FOB, moving sideways compared to May 4.
“During the given week, rebar futures prices first increased, while steelmakers have not issued further production cut plans yet, with selling partly withdrawing from the market, and the slack demand has also negatively affected the wire rod market,” an international trader said.
Offer prices of ex-China wire rod from traders have been heard at $540/mt CFR to the Philippines, with just a few transactions being done, while steelmakers’ low profitability at the current prices may make it impossible for the current prices to last long.
At the same time, Malaysian mill has been cutting prices recently. Ex-ASEAN offers were at $580/mt FOB last week, but over the past week a deal of ex-Malaysia wire rod has been heard at $590/mt CFR, Spain. Offers from Malaysia to Turkey have dropped to $600/mt CFR, being assessed as pretty competitive, taking into account that ex-Malaysia wire rod is not a subject for import duty.
Offer prices of ex-Indonesia wire rod have been heard at $590/mt CFR, the Philippines.
As of Thursday, May 11, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,600/mt ($521/mt), decreasing by RMB 15/mt ($2.2/mt) or down 0.4 percent since May 4, while declining by 2.65 percent compared to the previous trading day (May 10).
$1 = RMB 6.9101