Average offer prices for ex-China wire rod have increased again over the past week, even though local wire rod prices have seen some small downward corrections. The bullishness of Chinese suppliers has pushed up prices in the Southeast Asian market.
Offers for ex-China wire rod have been heard at $540-570/mt FOB, moving up by $10/mt on average compared to the previous week amid the rises seen in high-end offer prices. “Recently, orders for ex-China wire rod have been sufficient, with some steelmakers’ wire rod for February shipment being sold out, and so steelmakers have raised their high-end offer prices by $20/mt, signaling that they are unwilling to close deals,” an international trader said. The lower end of the range mainly reflects an indicative level, attractive for buyers.
Buyers from the Philippines have been bidding at $550/mt CFR for import wire rod, up by $15-20/mt from last week. Some deals for Southeast Asian billet (from Indonesia and Vietnam) have been closed at $540-545/mt CFR, but by the end of the week customers have increased their bids. At the same time, offers from Southeast Asian exporters have risen to $555-565/mt CFR.
In the local Chinese market, snowy and rainy weather negatively affected the demand for wire rod, while inventory has indicated a slight decline amid decreasing supply, which has bolstered prices to some extent. Meanwhile, market players are expected to build up stocks for the winter season, which will exert a positive impact on the local wire rod market.
As of Thursday, November 26, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,884/mt ($590.1/mt), decreasing by RMB 56/mt ($8.5/mt) or 1.42 percent since November 19, while increasing by 0.08 percent compared to the previous trading day.
$1 = RMB 6.578