Local Chinese longs prices fail to rise after holiday amid lack of new stimuli from finance ministry

As of October 14, average Chinese domestic rebar and wire rod prices have indicated decreases amid declining rebar futures prices.

The average rebar price has decreased by RMB 40/mt ($5.7/mt) compared to September 30, while the average 6.5 mm HPB 300 wire rod price has seen a decline of RMB 27/mt ($3.8/mt). Rebar prices have increased by RMB 40/mt ($5.7/mt) compared to the previous trading day, October 11.

During the given week, China’s Ministry of Finance announced that it would issue a series of stimulus policies, though which may not be as strong as market players’ expectation for funds of RMB 2.0 trillion, and so domestic rebar and wire rod prices have been negatively impacted. Market players considered that incremental demand from end-users needed more time to be observed, with the result that rebar and wire rod prices have indicated downward corrections following the long holiday. As of October 10, domestic inventories of wire rod and rebar in 21 major cities in China increased by 7.0 percent and 10.8 percent respectively compared to September 30, weakening the support for prices. However, market players believe that rebar and wire rod prices may increase in the coming week as October also forms part of the traditional peak season for business.

As of October 14, rebar futures at Shanghai Futures Exchange are standing at RMB 3,502/mt ($495/mt), decreasing by RMB 49/mt ($6.9/mt) or 1.4 percent since September 30, while up 1.36 percent compared to the previous trading day, October 11.

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 7.0723