Average offer prices for ex-China wire rod have edged down further over the past week due to the pressure from the selling off of material in the local market amid the change in the wire rod standard and falling futures prices. ASEAN mills have followed and have managed to sell some quantities in the Southeast Asian market. However, the trend is likely to come to a halt, market sources believe, amid the rebound in futures prices in China today and as prices are already too low for major exporters.
Ex-China wire rod offers from the second-tier mills have been heard at $490/mt FOB, edging down by $5/mt on average compared to last week, while reference deal prices have been heard at $485/mt FOB, also down by $5/mt week on week.
During the given week, wire rod prices in the Chinese domestic market have edged down amid the prevailing cautious sentiments among market players. The shift to the new national standard for wire rod has exerted a negative impact on inventory consumption of the old standard rebar. Iron ore prices have edged up slightly lately, bolstering wire rod prices to a certain degree. It is thought that wire rod prices in the Chinese domestic market will likely fluctuate within a limited range in the coming week, so changes in the export market will also be limited, according to market sources.
Wire rod offer prices from Indonesia’s Dexin have been heard at $485/mt FOB, moving down by $10/mt compared to early last week. One deal was reported at this level to Asia as done late last week, while this week another one has been signed at $480-485/mt FOB. Ex-Malaysia wire rod offers have been at $490-495/mt FOB, decreasing by $7.5/mt on average, but the major mill from Malaysia was also ready to provide discounts and to offer in line with Indonesian producer and some Chinese traders. Prices of ex-Vietnam Hoa Phat have remained the highest - at $500/mt FOB.
The lowest offers in the Thailand import market have been for ex-Malaysia 6.5 mm wire rod at $505/mt CFR with some deal signed. Also, though official offers for ex-ASEAN and ex-China wire rod to the Philippines have been at $510-515/mt CFR to the Philippines, the tradable level has been also not above $505/mt CFR, down by $5-10/mt over the week.
As of August 1, rebar futures at Shanghai Futures Exchange are standing at RMB 3,355/mt ($470.5/mt), increasing by RMB 26/mt ($3.6/mt) or 0.78 percent since July 25, while up 1.08 percent compared to the previous trading day, July 31.
$1 = RMB 7.1323
