Average offer prices for ex-China wire rod have remained unchanged over the past week. Inventories of wire rod have increased, exerting a negative impact on prices, but expectations for better local market developments later in September and strict inspections of non-VAT shipments have kept the general price level rather firm.
Offers for ex-China wire rod have been heard at $470-490/mt FOB, moving sideways compared to August 28, while the second-tier mills have been offering at the lower end of the range and the large mills at the higher end of the range. The tradable prices have been heard at $465-480/mt FOB.
Phase-based purchases from overseas buyers have been completed by the end of August, which may result in quiet activities in the coming period. Traders think Chinese wire rod offer prices might increase by $15-20/mt in the near future as the export tax policy on “buy-out” transactions will be further tightened after the National Day holiday (October 1-8). Local demand for wire rod from downstream users is expected to improve gradually. It is expected that wire rod prices in the Chinese domestic market will move sideways in the coming week.
Wire rod offer prices from Indonesia’s Dexin have been heard at $490/mt FOB, remaining stable over the past week. Offer prices of ex-Malaysia SAE1006 wire rod have been heard at $480-490/mt FOB, down $5/mt week on week, and offers of ex-Vietnam CB300V-D6 wire rod have been heard at $510-520/mt FOB, down $5/mt on average week on week.
In Southeast Asia, mainstream tradable prices of SAE1008 6.5 mm wire rod have been heard at $480-490/mt CFR, almost the same as last week, but all offers have been starting from $490/mt CFR due to increased inspections of Chinese export cargoes suspected of not paying VAT.
As of September 4, rebar futures at Shanghai Futures Exchange are standing at RMB 3,117/mt ($439/mt), decreasing by RMB 12/mt ($1.7/mt) or 0.4 percent since August 28, while down 0.06 percent compared to the previous trading day, September 3.
$1 = RMB 7.1052
