Local Chinese longs prices rise gradually, outlook still bearish

During the week ending October 26, average prices of Chinese domestic rebar and wire rod have edged up amid insufficient supply and quite good demand.

Over the past week, the average domestic rebar price has increased by RMB 13/mt, while the average wire rod prices has risen by RMB 20/mt. Demand has been quite good, though rebar futures prices have moved down recently, exerting a negative impact on the rebar market. Inventory has been going down gradually, providing support for rebar and wire rod prices, though demand has not been as good as what market players expected for October, which is the second month in the peak sales season. Approaching the end of October, more and more supplies from northern China may arrive in the market, which will likely weaken support for prices. It is thought that rebar and wire rod prices in the Chinese domestic market will edge down slightly in the coming week.

On October 26 rebar futures contract (2101) offers closed at RMB 3,613/mt ($542/mt) at Shanghai Futures Exchange, up RMB 2/mt ($0.30/mt) or by 0.055 percent since October 19 and down by 1.04 percent compared to the previous trading day, signaling market players’ bearish sentiments towards the prospects for the future market.

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 6.6725