Average offer prices for ex-China wire rod have moved up over the past week amid increasing futures prices and improved sentiments on the buyers’ side, both locally and abroad.
Offers for ex-China wire rod have been heard at $495-505/mt FOB, up $5/mt on average compared to April 23. The tradable prices have been heard at $490-510/mt FOB depending on the trade destination.
At the beginning of the given week, 50,000 mt of commercial grade wire rod from a steelmaker in northern China was sold at $555/mt CFR Jeddah, and, though this information could not be confirmed by the time of publication, market sources said it is possible from the seller’s viewpoint as the FOB level is assessed at $505-510/mt FOB.
During the given week, rebar futures prices have moved up, positively affecting wire rod prices in the spot market. Ahead of the Labor Day holiday (May 1-5), downstream users have built up certain stocks, providing support for wire rod prices. Wire rod production has increased slightly in the past week, while mills’ inventories have decreased amid users’ stock replenishments. However, it has been reported that semi-finished steel exports may be curbed. If such a policy is implemented, the wire rod market may be negatively affected. Moreover, the peak season for business is drawing to a close, which may weaken market sentiments. It is thought that wire rod prices in the Chinese domestic market will likely come under downward pressure after the holiday.
Wire rod offer prices from Indonesia’s Dexin Steel and from Malaysia’s Alliance Steel are at around $520/mt FOB for July shipment.
In Southeast Asia, mainstream tradable prices of 6.5 mm SAE1008 wire rod have been heard at $515-520/mt CFR.
As of April 30, rebar futures at Shanghai Futures Exchange are standing at RMB 3,214/mt ($468.5/mt), increasing by RMB 33/mt ($7.0/mt) or 1.0 percent since April 23, while up 1.04 percent compared to the previous trading day, April 29.
$1 = RMB 6.8628
