During the given week, ex-China rebar offer prices have surged by $30/mt compared to the previous week, as the Chinese government has announced a number of stimulus measures to support the economy and the struggling real estate market.
Ex-China rebar offer prices have been heard at $500-520/mt FOB, for November shipment, increasing by $30/mt on average compared to September 20, while up by $15/mt from yesterday, September 26.
During the given week, rebar prices in the Chinese domestic market have seen sharp increases after the People’s Bank of China announced a cut in the reserve requirement ratio (RRR) for Chinese banks by 0.5 percentage points and decreased the open market seven-day reverse repurchase operation rate by 20 basis points to 1.5 percent, both effective as of September 27. Market sentiments have been boosted, while rebar futures prices have indicated significant increases, bolstering prices in the spot market. At the same time, players in the rebar market have built up some stocks as the National Day Holiday (October 1-7) is approaching. It is thought that rebar prices in the Chinese domestic market will move up further after the holidays.
After the recent increase in the Chinese market, Malaysian rebar has been the most competitive in Southeast Asia. In Singapore, import offer prices of rebar from Malaysia have been heard at $495-500/mt CFR, theoretical weight, up by $10/mt over the past week. Since ex-China rebar offer prices have risen quickly, ASEAN mills will likely further adjust prices in an upward direction, while a wait-and-see stance has so far prevailed among buyers.
Average rebar spot prices in China have gained RMB 137/mt ($19.5/mt) compared to September 20, standing at RMB 3,477/mt ($496/mt) ex-warehouse, according to SteelOrbis’ information.
As of September 27, rebar futures at Shanghai Futures Exchange are standing at RMB 3,341/mt ($477/mt), increasing by RMB 176/mt ($3.5/mt) or 5.6 percent since September 20, while up 2.58 percent compared to the previous trading day, September 26.
$1 = RMB 7.0101