Local Chinese longs prices soften amid futures fall, weak performance in spot market

As of February 6, average Chinese domestic rebar and wire rod prices have indicated a downtrend compared to January 30. Poor demand and continuous falls in futures prices have contributed to the decline, SteelOrbis has learned.

The average rebar price has decreased by RMB 90/mt compared to January 30, while the average wire rod price has also fallen by RMB 90/mt. Rebar prices have decreased by RMB 10/mt since last Friday.

During the given week, rebar and wire rod prices in the Chinese domestic market have moved down following the rises in offer prices after the long holiday, even against the backdrop of low transaction activities. Demand from downstream users has been slack as most workers did not return to constructions sites before the Lantern Festival. Currently, market players mostly hold a wait-and-see stance as regards the futures prospects for the rebar and wire rod market as it will be rainy in many regions in China, which will negatively affect demand. However, construction sites are expected to resume activities in the latter part of this week, which will bolster rebar and wire rod prices. It is expected that rebar and wire rod prices in the Chinese domestic market will rise slightly in the coming week.

On February 6, rebar futures contract (rb2210) offers closed at RMB 4,049/mt ($598/mt) at Shanghai Futures Exchange, moving down by RMB 152/mt ($22.4/mt) compared to January 30.

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 6.7737