Market Trends:

According to price monitoring data from SunSirs, last week saw a trend of marginal improvement in supply-demand dynamics and accelerated inventory depletion for rebar and wire rods in the Jiangsu-Zhejiang-Shanghai region. Consequently, the price center shifted upward amidst fluctuations, and market sentiment showed signs of warming. As of the 17th, the average price for HRB400 rebar in the region stood at approximately 3,149.84 RMB/ton—a week-on-week increase of 0.31%—while the average price for HPB300 high-speed wire rods reached 3,317.5 RMB/ton, up 0.45% from the previous week.

Fundamental Analysis:

Market Overview: In terms of market dynamics, prices stabilized early in the week, bolstered by cost support; subsequently, driven by expectations of recovering demand and a restoration of market sentiment, the price center of gravity gradually shifted upward. Regionally, markets across East China, North China, and South China generally followed the upward trend; specifically, prices rose in 13 out of the 24 major rebar markets nationwide, accounting for 54.17% of the total. In the futures market, the benchmark rebar contract (2610) tracked spot market sentiment, exhibiting a volatile rebound pattern; on April 20, it closed at 3,172 RMB/ton—an increase of 1.24%. While capital sentiment showed signs of warming, the overall market stance remained cautious.

Supply Side: Last week, the supply side for rebar exhibited a slight contraction. According to data from Mysteel, during the week of April 10 to April 17, rebar production totaled 2.1314 million tons—a week-on-week decrease of 24,500 tons and a year-on-year decrease of 160,800 tons. Broken down by production process, output from long-process mills stood at 1.7986 million tons (down 19,000 tons week-on-week), while output from short-process mills was 332,800 tons (down 5,500 tons week-on-week); thus, production declined in both categories. Current rebar production levels sit at their lowest point for this time of year in nearly four years, indicating a marked reduction in supply-side pressure. Production increases were primarily concentrated in the Central China region, where the resumption of operations at a bar mill line in Hubei province boosted rebar operating rates; consequently, total output in the region rose by 19,500 tons week-on-week—an increase of 12.2%. Conversely, in the East and South China regions, overall production continued its downward trend as a result of voluntary output reductions implemented by several steel mills.

Regarding inventory: Inventory depletion accelerated significantly last week. As of April 17, total rebar inventory stood at 8.0196 million tons—a week-on-week decrease of 250,000 tons (3.02%), marking a notably faster pace of depletion compared to the week prior. Specifically, social inventory amounted to 6.0134 million tons (down 180,000 tons week-on-week), while steel mill inventory totaled 2.0062 million tons (down 69,200 tons week-on-week). The Southwest and South China regions recorded the largest declines in inventory, whereas regions such as Central-South China saw slight inventory increases. The total social inventory across the five major steel product categories fell by 396,000 tons week-on-week to 12.9265 million tons, reflecting a steady overall pace of inventory depletion.

Demand Side: Demand continues its seasonal recovery trend. Last week, the apparent consumption of rebar totaled 2.3838 million tons—a week-on-week increase of 92,400 tons, or 4.03%. Demand has now entered its traditional peak season channel, marking the eighth consecutive week of positive growth. Regarding construction material transactions, from April 10 to 16, the average daily trading volume of construction steel among 237 major traders reached 113,900 tons—a substantial week-on-week increase of 17%, reflecting a rise in overall market activity. On April 16 alone, daily transaction volume hit 129,600 tons, up 16.7% from the previous week. This improvement in demand is primarily driven by favorable weather conditions facilitating the resumption of downstream construction progress, as well as the release of essential demand from certain end-users against a backdrop of stabilizing prices. Cement outbound shipments rose by 15.89% week-on-week, while direct cement supplies to infrastructure projects increased by 25.21%, thereby validating the strength of demand emerging from the infrastructure sector.

Market outlook

In summary, the rebar market is expected to exhibit a volatile yet upward-leaning trend next week, with its price center shifting slightly higher. Key bullish factors include the release of pre-holiday restocking demand, persistently low production levels, and an accelerated drawdown of inventories; however, pressure on steel mill profit margins, year-on-year weakness in demand, and a narrowing window for the peak season are expected to limit the upside potential. Prices are projected to follow a trajectory of initial gains followed by stabilization: during the first half of the week, prices are likely to trend stronger, driven by restocking expectations; in the latter half, as restocking activities wind down and market dynamics revert to a fundamentals-driven interplay, the pace of price appreciation may moderate.

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