Local Chinese longs prices decline, stability expected ahead of holidays

As of September 2, average Chinese domestic rebar and wire rod prices have indicated declines over the past week due to still weak demand and falling futures prices. However, expectations are relatively stable for the current week as the mid-autumn festival holidays are approaching and demand is expected to range from moderate to slightly better.

The average rebar price has decreased by RMB 93/mt ($13/mt) compared to September 2, while the average 6.5 mm HPB 300 wire rod price has seen a drop of RMB 97/mt ($13.7/mt). Rebar prices have remained stable compared to the previous trading day, September 6.

During the given week, rebar and wire rod prices have moved down amid significant rises in production. Though inventories of rebar and wire rod have declined, market sentiments have not improved and so sellers have chosen to sell at lower prices. Although September is the traditional peak season for the steel industry, demand has not improved in line with expectations, exerting a negative impact on rebar and wire rod prices. It is thought that rebar and wire rod prices in the Chinese domestic market will fluctuate within a limited range in the coming week.

As of September 9, rebar futures at Shanghai Futures Exchange are standing at RMB 3,078/mt ($433.5/mt), decreasing by RMB 100/mt ($14/mt) or 3.1 percent since September 2, while up 0.36 percent compared to the previous trading day, September 6.  

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 7.0989