Local Chinese longs prices inch up since late April, but pessimism grows

Over the past two weeks, average Chinese domestic rebar and wire rod prices have seen very small changes - only slight increase, though prices on US dollar basis have moved down sharply due to the depreciation of the Chinese currency.  

During the past two weeks, the average rebar price has gained RMB 17/mt, while the average wire rod price has risen by RMB 30/mt. Compared to the average rebar price seen on Friday, prices have dropped by RMB 57/mt, SteelOrbis has learned, reflecting the bearish market sentiments.  

Rebar and wire rod prices have edged up slightly as China issued several policies to boost economic development, including releasing liquidity and relaxing restrictions on the property sector. However, the traditional offseason for business in the coming month is approaching, which has already negatively affect the demand for rebar and wire rod and may put pressure on prices in the near future. Moreover, though the lockdown in Shanghai may be lifted in the coming period, the rapid spread of the Covid-19 pandemic may exert a negative impact on other regions. It is thought that rebar and wire rod prices in the Chinese domestic market will edge down in the coming week.

On May 9, rebar futures contract (rb2210) offers have closed at RMB 4,654/mt ($694.6/mt) at Shanghai Futures Exchange, down RMB 124/mt ($18.5/mt) or by 2.6 percent compared to April 25.

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 6.6899