BEIJING: Steel rebar futures in China fell on Tuesday, breaking a three-day winning streak, signs that real estate growth in the country is easing, limiting steel demand for construction.
China's real estate growth slowed to 2 percent year-on-year in the fourth quarter from 4.1 percent a quarter earlier, data from the National Bureau of Statistics showed on Tuesday, as government tightening measures to curb speculation and skyrocketing prices subdued overall demand.
The sector-by-sector breakdown follows release of gross domestic product figures on Monday that showed China's economy in the last quarter expanded at its slowest rate since the global financial crisis.
Benchmark Shanghai rebar prices pared early gains and settled down 0.4 percent at 3,633 yuan ($533.97) a tonne at 0700 GMT. The contract earlier soared to as high as 3,700 yuan, its highest since Nov. 1.
However, hot-rolled coil futures rose 0.8 percent to 3,546 yuan a tonne.
The earlier price gain was fuelled by the Ministry of Ecology and Environment's vow to impose even tougher ultra-low emission standards at steel mills in 2019.
The plan follows orders last year for steel makers in the top steelmaking city of Tangshan to curtail output and install smog-filters on sintering machines that prepare raw iron ore for smelting, which led to a period of tight supply in the market.
The environment ministry also plans to extend emission limits to take in the Yangtze River Delta near Shanghai and the coal-rich Fenwei plain, in addition to the Beiing-Tianjin-Hebei area and nearby cities.
Meanwhile, industry website Shanghai Metals Market (SMM) reported that the Tangshan government may introduce production restrictions on sintering machines in the second and third quarter of this year.
Reuters was unable to reach the Tangshan government for comment.
Steelmaking raw materials also dipped on Tuesday as investors worry that more stringent environmental measures will dampen demand.
Dalian coking coal prices fell 1.2 percent to 1,215.5 yuan a tonne, while coke contract for May delivery lost 1.6 percent to 2,019 yuan.
The most-active iron ore futures on the Dalian Commodity Exchange closed 1.3 percent lower at 526 yuan a tonne.
"The restocking process at steel mills is nearing completion as most mills have stored enough raw materials for more than 20 days," said a Beijing-based iron ore trader.
"Not much demand is expected until workers come back to work after the week-long national holiday (in early February)."
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