Local Chinese rebar and wire rod prices move up, bearish mood starts to impact market

During the week ending December 14, average Chinese domestic rebar and wire rod prices have moved up sharply amid the high levels of iron ore prices.

Over the past week, the average rebar price has risen by RMB 117/mt, while the average wire rod price has increased by RMB 70/mt. During the given week, outputs of rebar and wire rod have decreased significantly amid more maintenance works carried out by steelmakers. Rebar futures prices and iron ore futures prices moved up sharply in the first part of the given week, though declining on December 14, signaling that bearish sentiment has started to appear in the market. Approaching the end of the year, financial tightness will negatively affect the rebar and wire rod market. Moreover, the weather in China has become colder since December 13, which will exert a negative impact on construction activities and slacken demand for rebar and wire rod. It is thought that rebar and wire rod prices in the Chinese domestic market will likely see a downward correction in the coming week.

On December 14, rebar futures contract (2101) offers closed at RMB 3,988/mt ($609/mt) at Shanghai Futures Exchange, up RMB 8/mt ($1.2/mt) or by 0.2 percent since December 7 and down by 2.92 percent compared to the previous trading day, which indicates that market players have started to be cautious as regards the future prospects for the market following the continuous rising trend.

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 6.5361