Chinese steel futures advance on falling inventory, demand pickup
- 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
BEIJING: Chinese steel rebar and hot rolled coils futures rose 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, jumped 3.2% to 5,312 yuan ($821.55) per tonne by 0215 GMT.
Hot rolled coils, used in the manufacturing sector, gained 2.8% to 5,581 yuan a tonne.
Stainless steel futures on the Shanghai bourse rose 1.6% to 17,720 yuan per tonne.
Prices of steelmaking ingredients on the Dalian Commodity Exchange were mixed.
Benchmark iron ore futures opened 4.9% higher before giving up most of the gains. They were last up 0.6% at 835 yuan.
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.
Dalian coking coal futures fell 1.2% to 2,461 yuan a tonne. Coke futures dipped 0.8% to 3,101 yuan per tonne.
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