Chinese steel futures track raw material prices higher
Posted on 07 July 2021
Chinese steel futures rose on Tuesday, on higher raw material prices and output-control expectations, although slowing construction activities and auto sales capped gains.
The most-actively traded construction rebar on the Shanghai Futures Exchange SRBcv1, for October delivery, gained 2.9% to 5,304 yuan ($821.15) per tonne at close.
Hot-rolled coils SHHCcv1, used in cars and home appliances, jumped 3.2% to 5,604 yuan a tonne.
The August contract for stainless steel on the Shanghai bourse SHSScv1 was up 2.2% at 16,880 yuan a tonne.
“Futures are stronger than spot prices as currently market has a relatively strong expectation on production restrictions,” GF Futures wrote in a note.
“Considering spot prices are supported by costs… (steel) will remain fluctuating at high levels,” it added.
Iron ore futures on the Dalian Commodity Exchange DCIOcv1, for September delivery, rose as much as 3.7% to 1,242 yuan per tonne. They ended 2.8% higher at 1,231 yuan a tonne.
Spot prices of iron ore with 62% iron content for delivery to China SH-CCN-IRNOR62, compiled by SteelHome consultancy, rose by $3.5 to $221 on Monday.
Dalian coking coal futures DJMcv1 remained unchanged at 1,949 yuan, while coke DCJcv1 inched down 0.1% to 2,642 yuan a tonne.
“After the centenary, domestic coal mines would gradually resume production, but it still takes time for overall recovery,” Huatai Futures said in a note, adding that coking coal is expected to face tight supply in the short term.Source : Reuters