Weak sentiment in local Chinese rebar and wire rod market

During the week ending December 26, Chinese domestic rebar and wire rod prices have moved on a declining trend, while transaction activity in the domestic rebar and wire rod market has been at low levels. On December 26, rebar futures contract (1705) offers closed at RMB 2,922/mt ($420/mt) at Shanghai Futures Exchange, down $27/mt week on week. Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.

Due to the upward movement previously seen in rebar and wire rod prices, Chinese steel mills have increased their production during the past week. The rise in Chinese steel producers' production rates has been to a certain degree since it is the traditional off-season amid the current cold winter weather conditions, while it has also increased the rebar and wire rod supply in the market, reducing the upward pressure on prices caused by the tightness of supply. Traders have been mostly eager to sell and so they have lowered their domestic rebar and wire rod prices for the Chinese spot market. Meanwhile, speculative sentiment in the local Chinese market has been curbed to some extent and raw material prices have decreased over the past week, which will reduce support for rebar and wire rod prices. It is thought that rebar and wire rod prices in the Chinese domestic market will likely to maintain their declining trend in the coming week.

Wire rod prices in local Chinese market

All prices include 17 percent VAT and all prices are ex-warehouse.

 
Rebar prices in local Chinese market

All prices include 17 percent VAT and all prices are ex-warehouse
 
$1 = RMB 6.95