Local Chinese longs prices soften slightly, but outlook promising

During the week ending March 1, average Chinese domestic rebar and wire rod prices have moved down slightly after the sharp rises seen just after the holiday. Nevertheless, improvement in construction activity is likely to provide support for longs prices in March.

During the given week, the average rebar price in China has lost RMB 23/mt, while the average wire rod price has declined by RMB 10/mt.  

During the given week, rebar and wire rod prices have indicated downward corrections following the previous big rises. However, downstream users’ production capacity utilizations will gradually increase as most workers will be back at work after the Lantern Festival (February 26), which will stimulate more demand for rebar and wire rod. The inventory of rebar and wire rod has risen as market players have started to be cautious as prices rose too quickly. Since demand is expected to be better, the outlook is promising for the Chinese domestic longs market.

On March 1, rebar futures contract (2105) offers closed at RMB 4,639/mt ($716/mt) at Shanghai Futures Exchange, up RMB 57/mt ($8.8/mt) or by 1.24 percent compared to February 22, but was down by 0.69 percent compared to the previous trading day (February 26), signaling market players’ cautious sentiments.

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 6.4754