Local Chinese rebar and wire rod market moves on rising trend

During the week ending July 4, Chinese domestic rebar and wire rod prices have indicated upward movement, while transaction activity in the overall domestic rebar and wire rod market is still at low levels. On July 4, rebar futures contract (1610) offers closed at RMB 2,424/mt ($365/mt) at Shanghai Futures Exchange, up $13/mt week on week. 

  

During the given week, inventory levels of rebar and wire rod in the domestic spot market have declined, providing support for rebar and wire rod prices. At the same time, rebar futures prices have indicated an upward trend, exerting a positive impact on rebar and wire rod prices. However, real consumption in the Chinese domestic market has not improved as heavy rainfall across the country has had a strong negative impact on construction activities. Since bullish sentiment prevails among market players as regards the future prospects for the rebar and wire rod market, it is expected that rebar and wire rod prices in the Chinese domestic market will likely move up further in the coming week, though increase margins will be limited as supply will increase as prices rise. 

 

$1 = RMB 6.65