BEIJING: Chinese stainless steel futures dropped on Wednesday to their lowest in more than three months, dented by sluggish downstream demand and easing raw material prices.
The most actively traded stainless steel on the Shanghai Futures Exchange, for January delivery, was down 3.6% at 16,180 yuan ($2,546.91) a tonne, as of 0312 GMT. Earlier in the session, it fell as much as 4% to 16,120 yuan, the lowest since Sept. 2.
“Planned stainless steel production for December is considerable, but downstream demand is weak,” analysts with GF Futures wrote in a note, adding that lower ferrochrome and stainless steel scrap prices also reduced costs at mills. Other steel prices on the Shanghai bourse slipped as well. Construction used rebar, for May delivery, declined 1.1% to 4,389 yuan a tonne. Hot rolled coils, used in cars and home appliances, slipped 1.5% to 4,556 yuan per tonne.
Prices of steelmaking ingredients on the Dalian Commodity Exchange were mixed. Benchmark iron ore futures were up 0.8% at 654 yuan a tonne, extending gains to a third session, after jumping more than 3% at market open.