Price trend

According to data from SunSirs, in October, the price of wire rod and rebar declined slightly and trended weaker. As of the 30th, the average price of HRB400 rebar in Hangzhou was 3,200 RMB/ton, up 0.99% from the beginning of the month; the average price of HPB300 high-strength wire rod in the Jiangsu, Zhejiang and Shanghai regions was 3,365 RMB/ton, up 0.22% from the beginning of the month.

Factors affecting price

According to data from SunSirs, both weekly production and total inventory of wire rod and rebar decreased in October.

As of October 30, rebar weekly output increased by 55,200 tons week-on-week to 2,125,900 tons, and by 61,300 tons month-on-month; social inventory decreased by 66,700 tons week-on-week to 4,308,100 tons, and by 410,800 tons month-on-month; mill inventory decreased by 129,200 tons week-on-week to 1,717,100 tons, and by 73,000 tons month-on-month.

On the supply side, construction material output reached 3.024 million tons last week, an increase of 70,100 tons compared to the previous week, continuing its growth trend. Both rebar and wire rod output rebounded last week. National rebar output increased by 55,200 tons, with widespread increases, particularly in Jiangsu and Hebei provinces, mainly due to steel mill resumptions and pig iron allocation; only some areas in Southwest and North China saw slight production reductions. Wire rod output also increased by 14,900 tons, with the increase mainly concentrated in East China (especially Jiangsu) and Northeast China. Overall, supply showed a slight expansion trend.

Market Overview: Despite continued government support policies for the real estate sector across various regions, market confidence was recovering slowly; new home sales data remained weak, and the financial pressure on real estate companies had not fundamentally improved; while the issuance of special-purpose bonds had accelerated, it takes time for the funds to materialize and translate into tangible work, and the marginal effect of infrastructure investment on steel demand was weakening. Later, influenced by seasonal factors, the market declined with significant inventory pressure. Trading primarily focused on quick turnover, and merchants maintained low inventory levels with a strong willingness to sell.

On the demand side: the national average weekly transaction volume was 100,600 tons during the previous week, an increase of 2,840 tons week-on-week. As of October 30, the transaction volume of building materials was higher than the previous week, and the transaction situation continued to recover, with the transaction volume remaining above 100,000 tons, indicating that downstream end-user demand still had a certain degree of resilience. However, downstream demand may experience a seasonal decline in November, with a projected decrease in demand for November.

Market outlook

On the demand side, the steel market may turn into the off-season in November. Although downstream terminal operations will continue, procurement may slow down. In addition, since October, steel mills have been reducing production due to poor profits, and supply has also decreased accordingly. With the weather turning colder in November, downstream construction site demand may slow down, and inventory may continue to decline. Merchants are willing to support prices.

In summary, terminal operations continue steadily in November, and the wire rod and rebar market is likely to maintain a weak supply and demand fundamental. Although speculative sentiment in the market has cooled somewhat, traders still have the willingness to support prices. In addition, steel mill output is running at low levels, which is conducive to the destocking process of construction materials. However, the support from the raw material side is weakening. It is expected that wire rod and rebar prices in November may fall first and then rise, with a weaker and volatile trend.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.