During the week ending May 17, average Chinese domestic rebar and wire rod prices have moved down significantly amid the big declines in ferrous metal futures, the drop in billet prices and worries about possible oversupply in the future as production remains high. Sentiment in the Chinese market has changed from positive to negative.
During the given period, the average rebar price in China has lost RMB 443/mt, while the average wire rod price has declined by RMB 400/mt. Rebar prices have fallen by as much as RMB 197/mt on Monday compared to the level last Friday, reflecting the weakening in futures prices and sentiments.
During the given week, rebar and wire rod prices in China have moved down sharply as rebar futures prices have indicated big declines following previous significant rises. Cautious sentiments prevail among market players, exerting a negative impact on rebar and wire rod prices. Meanwhile, steelmakers’ production activities have been at normal levels, contributing to balanced supply and demand, but when consumption will decline in the summer season the market may become oversupplied very rapidly, sources believe.
Rainy weather will hit most regions of China, which will negatively affect the demand for rebar and wire rod in the near future. It is thought that rebar and wire rod prices in the Chinese domestic market will likely move on a downward trend in the coming week.
On May 17, rebar futures contracts (2105) closed at RMB 5,596/mt ($870.3/mt) at Shanghai Futures Exchange, down RMB 416/mt ($64.7/mt) or by 6.92 percent compared to May 10, signaling market players’ bearish sentiments towards the future prospects for the rebar market following previous sharp rises.
Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.
Rebar prices in local markets
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price |
Weekly change |
Weekly change |
25 - HRB400 |
Beijing |
5,840 |
908.1 |
-450 |
-68.2 |
Guangzhou |
5,870 |
912.8 |
-380 |
-57.3 |
|
Shanghai |
5,550 |
863.0 |
-500 |
-76.0 |
|
Average price |
5,753.3 |
894.6 |
-443 |
-67.1 |
All prices include 13 percent VAT and all prices are ex-warehouse.
Wire rod prices in local markets
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Weekly change |
6.5 - HPB300 |
Beijing |
6,490 |
1009.2 |
-340 |
-50.9 |
Guangzhou |
6,230 |
968.7 |
-390 |
-58.7 |
|
Shanghai |
6,070 |
943.9 |
-470 |
-71.2 |
|
Average price |
6,263.3 |
973.9 |
-400 |
-60.3 |
|
8 - HPB300 |
Beijing |
6,270 |
975.0 |
-340 |
-51.0 |
Guangzhou |
6,170 |
959.4 |
-390 |
-58.7 |
|
Shanghai |
6,030 |
937.6 |
-470 |
-71.2 |
|
Average price |
6,156.7 |
957.3 |
-400 |
-60.3 |
All prices include 13 percent VAT and all prices are ex-warehouse.
$1 = RMB 6.4307