Steel reinforcement-bar futures fell to a three-month low on concern Chinese demand may recede during winter without more government-funded infrastructure projects.
Rebar for delivery in January on the Shanghai Futures Exchange fell as much as 1 percent to 3,550 yuan ($580) a metric ton, the lowest since July 2, and traded at 3,555 yuan at 9:51 a.m. local time. Chinese markets were closed for a week for the National Day holiday.
China’s steel demand usually wanes in November as construction activity slows in the winter months unless government unveils “massive and substantial” infrastructure projects, according to Citic Securities Futures Co. Average daily crude steel output in China rose to 2.14 million tons in mid-September, from 2.13 million tons in the first 10 days of September, according to the China Iron and Steel Association.
“Mills continued to crank out steel products as much as they can, so demand needs to rise accordingly to help absorb supply,” said Huang Fulong, an analyst at Citic in Shenzhen.
Iron ore for immediate delivery at Tianjin port was at $131.40 a dry ton on Sept. 30 before the holiday, according to a price index compiled by The Steel Index Ltd. The average spot price of rebar retreated 0.2 percent on Sept. 30 to 3,488 yuan a ton, according to Beijing Antaike Information Development Co.
To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at firstname.lastname@example.org
To contact the editor responsible for this story: Brett Miller at email@example.com