Local Chinese longs prices fall further with fundamentals worsening

As of April 10, average Chinese domestic rebar and wire rod prices have moved down compared to the previous week as the fundamentals of demand and supply have worsened and no improvement has been seen so far, with some sources believing that a gradual downtrend may continue in the coming few weeks.    

The average rebar price has decreased by RMB 80/mt compared to April 3, while the average 6.5 mm HPB 300 wire rod price has declined by the same amount. Rebar prices have seen a drop of RMB 17/mt compared to last Friday.  

During the given week, rebar and wire rod prices in the Chinese domestic market have moved down amid declining raw material prices and decreasing rebar futures prices. The demand for rebar and wire rod has slackened to some extent, weakening the support for market sentiment, even though inventory has decreased. Rebar and wire rod producers may reduce their capacity utilization rates as they have struggling to make a profit, while traders have sought to reduce inventory levels. It is expected that rebar and wire rod prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week, with some bearish bias. “April should be a good month, but not this year. Rains and not enough demand have made the market negative,” a source said.   

On April 10, rebar futures contract (rb2210) offers closed at RMB 3,907/mt ($568/mt) at Shanghai Futures Exchange, decreasing by RMB 137/mt ($19.9/mt) compared to April 3.   

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 6.8764