The downtrend in the rebar market in Asia has been confirmed in new bookings at lower prices to Southeast Asia, amid pressure from declining scrap prices in the international market. During the given week, ex-China rebar offer prices have moved down amid the decreasing trend in the local market.
Last week, a cargo of around 50,000 mt of ex-Turkey rebar was sold at approximately $650-655/mt CFR on theoretical basis to Singapore. And though for the seller this price indicated a decline compared to previous offers, this price has been indicated as too high for the current market conditions, sources have said.
In particular, a contract for a lot of similar size has been rumored at $650/mt CFR actual weight to Hong Kong, which is around $15/mt lower than the price level in the deal to Singapore, according to sources. A week before, the workable price level in Hong Kong was at $670-685/mt CFR.
As a result, the tradable price level for import rebar in Singapore has been lowered from $650-655/mt CFR to $630-635/mt CFR theoretical weight this week. Moreover, at around this level ($630-640/mt CFR theoretical weight) some small-volume offers for Chinese cargoes have been heard.
Ex-China rebar offer prices have been heard at $615-635/mt, FOB for late March shipment, decreasing by $10/mt on average compared to January 15. “The Covid-19 pandemic has become worse in China, negatively affecting market players’ sentiments, weakening support for local rebar prices and exerting a negative impact on ex-China rebar prices,” an international trader said.
In the local Chinese market, rebar futures prices have edged down in the given week as inventory levels have increased during the traditional offseason. The iron ore prices have been at high levels, which bolstered rebar prices from the cost side for some extent.
Average rebar spot prices in China have lost RMB 14/mt ($2.2/mt) week on week to RMB 4,343/mt ($672.3/mt) ex-warehouse, according to SteelOrbis’ information.
As of January 22, rebar futures at the Shanghai Futures Exchange are standing at RMB 4,294/mt ($665/mt), decreasing by RMB 66/mt ($10.2/mt) or 1.5 percent since January 15.
$1 = RMB 6.4617