Local Chinese longs prices inch up, but weak winter demand impacts mood

As of December 2, average Chinese domestic rebar and wire rod prices have moved up amid increasing futures prices, though the pressure on mills has increased with falling profitability and slack winter demand.

The average rebar price has risen by RMB 30/mt ($4.2/mt) compared to November 25, while the average 6.5 mm HPB 300 wire rod price has seen an increase of RMB 23/mt ($3.2/mt). Rebar prices have increased by RMB 16/mt ($2.2/mt) compared to the previous trading day, November 29.

During the given week, rebar and wire rod prices in the Chinese domestic market have been supported by increasing rebar futures. However, the demand for rebar and wire rod has slackened during the traditional offseason. Meanwhile, inventories of rebar and wire rod have increased, exerting a negative impact on prices. Though rebar and wire rod producers’ production capacity utilization rates have declined, demand has also declined gradually. It is thought that rebar and wire rod prices in the Chinese domestic market will fluctuate within a limited range in the coming week.

As of December 2, rebar futures at Shanghai Futures Exchange are standing at RMB 3,333/mt ($464/mt), increasing by RMB 36/mt ($5/mt) or 1.1 percent since November 25, while up 0.18 percent compared to the previous trading day, November 29.

Average domestic rebar and wire rod prices in China's main markets are presented in the tables below.

Rebar prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

 Wire rod prices in local markets

All prices include 13 percent VAT and all prices are ex-warehouse.

$1 = RMB 7.1865