Steel futures prices in China jumped on Monday, with hot-rolled coils and construction rebar climbing more than 4% in intraday trade to narrow the gap with spot prices, as traders cheered a marginal improvement in consumption of industrial metals.
Apparent demand for five main steel products in China, including rebar, wire rod and hot-rolled coils, gained for two consecutive weeks and was up 4.2% last week from early-November, data from Mysteel consultancy showed.
“In the short term, the property-related policy is expected to see improvement, which could probably lift market sentiment,” Galaxy Futures wrote in a note, warning that the spot market still faced risk of lower costs and consumption.
Spot prices of rebar and hot-rolled coils were about 400 yuan and 200 yuan higher, respectively, than the currently most-traded January futures contracts.
Analysts with GF Futures noted that possible marginal easing of real estate financing situation was not likely to reverse steel demand of January deliveries.
The most-active construction rebar futures on the Shanghai Futures Exchange SRBcv1 gained as much as 4.3% to 4,385 yuan ($687.21) per tonne. They ended up 2.3% at 4,300 yuan a tonne.
Hot-rolled coils SHHCcv1, used in cars and home appliances, closed 0.9% higher at 4,405 yuan a tonne, after rising 4.7% earlier in the session.
Stainless steel futures on the Shanghai bourse SHSScv1 rose 1.2% to 17,330 yuan per tonne.
Prices for steelmaking ingredients on the Dalian Commodity Exchange were mixed.
Benchmark iron ore futures DCIOcv1, for January delivery, surged 6.2% to 558 yuan a tonne. Spot prices of iron ore with 62% iron content for delivery to China SH-CCN-IRNOR62 were up $1.5 at $91.5 a tonne on Friday, according to SteelHome consultancy.
Dalian coke futures DCJcv1 jumped 3.8% to 2,866 yuan a tonne.
Coking coal prices DJMcv1, however, edged down 0.4% to 1,856 yuan per tonne after the state planner said coal output continued to increase.
Source: Reuters
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