Local Chinese longs prices down in north China amid extremely cold weather

During the week ending January 11, average Chinese domestic rebar and wire rod prices have posted small declines, with a visible price drop seen in Shanghai due to cold weather, though prices have moved up slightly in some other regions.

Over the past week, the average rebar price in China has lost RMB 7/mt, while the average wire rod price has decreased by RMB 37/mt.

During the given week, due to extremely cold weather, demand for rebar and wire rod in eastern China has slackened, dragging down prices. On January 11, rebar futures prices have moved down by 2.79 percent compared to the previous trading day, exerting a negative impact on market sentiment. At the same time, due to the Covid-19 pandemic affecting Hebei Province, demand has shrunk significantly in northern China.

Currently, supply of rebar is steady, while it is expected that supply will start to decline in the near future due to the approach of the Chinese New Year holiday. This year, migrant workers will be return to their hometowns in batches starting in the latter half of January to ensure prevention and control of the epidemic, which will negatively affect construction activities. It is thought that rebar and wire rod prices will edge down in the coming period. 

On January 11, rebar futures contract (2105) offers closed at RMB 4,348/mt ($671/mt) at Shanghai Futures Exchange, down RMB 35/mt ($5.4/mt) or by 0.8 percent compared to January 4 and down by 2.79 percent compared to the previous trading day (January 8), signaling market players’ bearish sentiments towards the future prospects for the market.

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 6.4764