Posted on 04 Dec 2020
The Southeast Asian import market for wire rod has continued to soar over the past week on the back of buoyant Chinese domestic demand, Kallanish notes. Chinese export prices are very close to $600/tonne cfr, a massive month-on-month jump from $535-540/t cfr in early November.
Deals for 6.5mm diameter wire rod from ASEAN suppliers have been concluded this week at $20/t higher from last week. In Thailand, an order for 3,000 tonnes of Malaysian wire rod was heard booked Tuesday at $575/t cif. "It was a small quantity because the buyer fears that prices will drop," a Thai trader says. He also heard another lot of 5,000t was ordered at $580/t cif.
Last week, offer prices for Indonesian wire rod were prevailing at $555-558/t cfr Manila. This week, offers for Malaysian wire rod are heard at $580-585/t cfr and those from China at $595/t cfr. Chinese SAE 1006 wire rod was ordered last Friday at slightly above $580/t cfr. A Manila trader notes that Chinese suppliers charge the same price for both SAE 1006 and SAE 1008 wire rod.
Kallanish assessed SAE 1008 6.5mm diameter wire rod at $575-580/t cif Manila on Thursday. This is $25/t higher on-week and $75/t up on the first week of November.
Chinese prices influence regional prices because China is a traditional supplier to the region. Chinese wire rod exports to Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam totalled 462,404t during January-October. The Philippines, Vietnam and Thailand were the main recipients of Chinese exports, taking shares of 29.7%, 26.6% and 22.5% respectively.
During January-October 2019, Chinese wire rod exports totalled 668,740t, reaching 767,796t in full-year 2019. ASEAN wire rod intake has been hit by slower demand brought about by pandemic curbs. Expanded regional capacity of wire rod including in Indonesia this year has also resulted in more intra-regional trading.
Source:Kallanish
