BEIJING: Chinese steel futures rose about 4% on Monday, as inventories of the industrial metals fell for a fourth straight week and downstream demand picked up. Stockpiles of five main steel products including rebar and hot rolled coils dipped 1.1% last week from a week earlier to 21 million tonnes, data from Mysteel consultancy showed, while apparent consumption rose 1.2% to 10.36 million tonnes.
“With the arrival of the peak season, demand is expected to get better, and a tightening crude steel cut policy will benefit far month steel contracts,” GF Futures wrote in a note. The most-active steel rebar on the Shanghai Futures Exchange, for January delivery, ended up 4% to 5,354 yuan ($827.68) a tonne. Hot rolled coils, used in the manufacturing sector, gained 3.8% at 5,637 yuan at close.
Stainless steel futures on the Shanghai bourse jumped 3.9% to 18,125 yuan a tonne. Prices of steelmaking ingredients on the Dalian Commodity Exchange also increased.
Benchmark iron ore futures opened 4.9% higher before giving up most of the gains. They were last up 0.7% at 835 yuan a tonne. Spot prices of iron ore with 62% iron content for delivery to China rose by $4 to $156 a tonne, according to SteelHome consultancy. “Global iron ore production growth will accelerate over 2021-2025 after stagnating during the previous five years,” Fitch Solutions wrote in a note, adding China’s ore output would grow.
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