Local Chinese longs prices down sharply amid insufficient demand

During the week ending October 18, average Chinese domestic rebar and wire rod prices have moved down sharply amid declining rebar futures prices and the prevailing cautious sentiments among market players due to insufficient demand in some parts of the country.

During the given period, the average rebar price has lost RMB 230/mt, while the average wire rod price has also declined by RMB 230/mt.  

Over the past week, rebar and wire rod prices have moved down sharply following big rises after the National Day holiday amid the resumption of production and slack demand in the local market. In the given week, a round of cold weather has hit most regions of China, especially northern China, exerting a negative impact on construction activities and weakening the support for the rebar and wire rod market. In eastern and southern China, there have been shortages of supply for some specifications, resulting in a better situation for prices there. It is thought that rebar and wire rod prices in the Chinese domestic market will likely bottom up in the coming week.

On October 18, rebar futures contract (2105) offers closed at RMB 5,422/mt ($843/mt) at Shanghai Futures Exchange, down RMB 386/mt ($60/mt) or by 6.65 percent compared to October 11, reflecting market players’ bearish sentiments.

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 6.43