Local Chinese longs prices decline, but expectations rather positive

As of November 4, average Chinese domestic rebar and wire rod prices have moved down amid declining rebar futures prices, but in general expectations are cautiously positive amid the anticipated new package of economic stimulus measures.

The average rebar price has decreased by RMB 80/mt ($11.2/mt) compared to October 28, while the average 6.5 mm HPB 300 wire rod price has seen a drop of RMB 80/mt ($11.2/mt). Rebar prices have decreased by RMB 23/mt ($3.2/mt) compared to the previous trading day, November 1.

During the given week, rebar and wire rod prices in the Chinese domestic market have moved down amid slack demand due to the cold weather in northern China. Inventories of rebar and wire rod have risen rapidly in some cities, exerting a negative impact on prices. Supply of rebar and wire rod is anticipated to decline in the coming week, while demand may slacken further as the weather becomes colder on the middle and lower reaches of the Yangtze River. An anticipated new package of stimulus measures will likely bolster market sentiments. It is thought that rebar and wire rod prices in the Chinese domestic market will edge up in the coming week.

As of November 4, rebar futures at Shanghai Futures Exchange are standing at RMB 3,425/mt ($484/mt), decreasing by RMB 26/mt ($3.7/mt) or 0.75 percent since October 28, while up 0.74 percent compared to the previous trading day, November 1.

Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.

Rebar prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

 Wire rod prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

$1 = RMB 7.1203