Local Chinese longs prices may soften soon after rise amid snowy weather

During the week ending November 23, average Chinese domestic rebar and wire rod prices have moved up amid declining inventories and quite good demand. However, colder weather has impacted China and will exert a negative impact on the rebar and wire rod market in the near future.

Over the past week, the average rebar price has increased by RMB 63/mt, while the average wire rod price has risen by RMB 73/mt. Demand for rebar and wire rod is still decent, while inventories have decreased more slowly, which may negatively affect prices. The snowy weather in northern China will exert a negative impact on construction activities there, which will stimulate the flow of rebar and wire rod supplies from there to eastern China, resulting in downward pressure on prices. It is expected that rebar and wire rod prices in the Chinese domestic market will likely edge down in the coming week.

On November 23, rebar futures contract (2101) offers closed at RMB 3,911/mt ($595.3/mt) at Shanghai Futures Exchange, down RMB 59/mt ($9/mt) or by 1.53 percent since November 16 and down by 1.11 percent compared to the previous trading day, reflecting market players’ caution as regards the future prospects for the market amid the colder weather in China.

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 6.5719