Average offer prices for ex-China wire rod have moved sideways over the past week, but in general sentiments are weaker towards the end of the week due to the slowdown of demand in China and the decrease in futures prices.
Offers for ex-China wire rod from second-tier mills have been heard at $450-470/mt FOB, remaining stable on average compared to May 15, while from large mills prices have mainly been at $470-475/mt FOB, slightly down from 4480/mt FOB last week.
The rainy season has slackened the demand for wire rod in the Chinese domestic market, while inventory consumption has slowed down, exerting a negative impact on prices. However, the substantial progress in the US-China trade negotiations may positively affect steel exports in May and June, which will bolster market sentiments. It is thought that wire rod prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week.
Wire rod offer prices from Indonesia’s Dexin are stable at $520/mt FOB, for September shipment, as the mill has no need to sell. However, offer prices of ex-Malaysia wire rod have been heard at $480-490/mt FOB, down $15/mt on average compared to May 15, as sellers have been trying to accelerate sales, to the regional market in particular. Offer prices of ex-Vietnam wire rod have been heard at $500/mt FOB, down $5/mt week on week.
In Southeast Asia’s import market, prices for SAE1006 import wire rod have remained stable at $480-490/mt CFR, while deals have been confirmed at these levels. The lower end of the range corresponds to small ex-China Q195 deals to the Philippines, while Thai buyers have booked at $485-490/mt CFR.
As of May 22, rebar futures at Shanghai Futures Exchange are standing at RMB 3,061/mt ($433/mt), decreasing by RMB 57/mt ($7.9/mt) or 1.8 percent since May 15, while down 0.03 percent compared to the previous trading day, May 21.
$1 = RMB 7.1903
