During the week ending August 9, average Chinese domestic rebar and wire rod prices have moved down as demand has weakened due to heavy rainfall and the worsened Covid-19 pandemic situation, while declining rebar futures prices have reflected the poor sentiment in the market and the poor outlook for the near future.
During the given period, the average rebar price in China has lost RMB 43/mt, while the average wire rod price has gone down by RMB 50/mt.
Rebar and wire rod prices have been under pressure as China's central government stated it will issue measures to stabilize commodity prices, which dragged down rebar futures prices and exerted a negative impact on prices in the spot market. The demand for rebar and wire rod has not seen any improvement yet: moreover, in some areas it has shown signs of declining further.
Starting from Sunday, August 8, heavy rainfall has started to be seen in the southwestern parts of China, in particular in Sichuan, Chongqing, Guizhou and Yunnan, with up to 230 mm of rainfall in certain areas, according to the official news agency Xinhua. This has halted construction activities for now and heavy rains are expected to continue for the next three days, according to China's National Meteorological Centre.
The production restrictions will reduce output and may prevent prices from recording a very sharp fall in the near future, while declining iron ore prices may negatively affect the rebar and wire rod market. It is thought that rebar and wire rod prices may edge down in the coming week.
On August 9, rebar futures contract (2105) offers closed at RMB 5,330/mt ($822/mt) at Shanghai Futures Exchange, down RMB 84/mt ($13/mt) or by 1.55 percent compared to August 2, signaling market players’ cautious sentiments towards the prospect for the rebar market.
Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.
Rebar prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price |
Weekly change |
Weekly change |
|
25 - HRB400 |
Beijing |
5,140 |
792.7 |
-50 |
-9.9 |
|
Guangzhou |
5,570 |
859.0 |
-70 |
-13.2 |
|
|
Shanghai |
5,220 |
805.1 |
-10 |
-3.8 |
|
|
Average price |
5,310.0 |
818.9 |
-43 |
-9.0 |
All prices include 13 percent VAT and all prices are ex-warehouse.
Wire rod prices in local markets
|
Spec. (mm) - Category |
City |
Price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Weekly change |
|
6.5 - HPB300 |
Beijing |
6,200 |
956.2 |
-20 |
-5.8 |
|
Guangzhou |
5,930 |
914.6 |
-120 |
-21.1 |
|
|
Shanghai |
5,470 |
843.6 |
-10 |
-3.9 |
|
|
Average price |
5,866.7 |
904.8 |
-50 |
-10.3 |
|
|
8 - HPB300 |
Beijing |
5,980 |
922.3 |
-20 |
-5.7 |
|
Guangzhou |
5,870 |
905.3 |
-120 |
-21.1 |
|
|
Shanghai |
5,410 |
834.4 |
-10 |
-3.9 |
|
|
Average price |
5,753.3 |
887.3 |
-50 |
-10.2 |
All prices include 13 percent VAT and all prices are ex-warehouse.
$1 = RMB 6.484