Prices for imported wire rod in Southeast Asia have posted strong increases as expectations over a demand improvement ahead of spring and rises in billet and scrap prices have boosted sentiments. Average offer prices for ex-China wire rod have moved on an uptrend over the past week too.
The peak season for restocking for spring has started, stabilizing market sentiments in Asia with offers of wire rod from private steelmakers in China heard at $650-670/mt CFR Philippines. This level is much higher than $630-640/mt CFR available from some sources a week ago. “Prices have risen sharply. No chance of getting anything lower,” a trader said.
Ex-ASEAN mills have increased offers to $645/mt FOB from Malaysia and $650-660/mt FOB from Indonesia, with the freight to Southeast Asia is around $15-20/mt.
Offers for ex-China wire rod from private mills in Tangshan have been heard at $630-650/mt FOB, moving up by $15/mt compared to February 16, while some large producers still insisting on $660-670/mt FOB, the same as last week, have failed to attract interest.
“During the given week, wire rod prices in the Chinese domestic market have moved up amid the expected decrease in output due to the upcoming two government sessions in China, while semi-finished steel prices have also indicated an uptrend, exerting a positive impact on the wire rod market in Southeast Asia, though buyers have still remained calm,” an international trader said.
As of Thursday, February 23, rebar futures at the Shanghai Futures Exchange are standing at RMB 4,228/mt ($613/mt), rising by RMB 82/mt ($11.9/mt) or up 2.0 percent since February 16, while decreasing by 0.4 percent compared to the previous trading day (February 22).
$1 = RMB 6.9028