China's construction rebar futures drifted higher on Friday, following a broader rally across assets, as investors hoped that the US and China get closer to a trade deal. However, the futures still marked for the weakest week in three months. Top US and Chinese trade negotiators concluded the first of two days of trade talks after China's Vice Premier Liu He said, "We (have) come here this time, under pressure, which shows China's greatest sincerity".
Meanwhile, U.S President Donald Trump said on Thursday he had received a "beautiful letter" from Chinese President Xi Jinping and believed it was possible to reach a deal this week. Before the second day of the scheduled talks though, the United States had hiked duties on $200 billion of Chinese goods, applying to cargoes leaving China after 0401 GMT on Friday.
Benchmark Shanghai rebar prices edged up 0.5% to 3,746 yuan ($550.90) a tonne - recording for its worst weekly performance since mid-February. Hot-rolled coil futures rose 0.5% to 3,682 yuan a tonne. China's vow to tighten approvals of steel capacity swapping between companies and to ban all new steel capacity in any form also helped to offer support to steel prices.
Utilisation rates at steel mills across China dropped 1.8 percentage point this week as of May 10 to 68.78 percent, according to data compiled by Mysteel consultancy, reflecting the enforcement of heightened production restrictions in top steelmaking city Tangshan. Steel inventory at Chinese traders fell 273,000 tonnes this week to 12.14 million tonnes, with rebar down to 6.33 million tonnes and hot rolled coil up to 2.13 million tonnes, Mysteel data further showed. The most-traded iron ore contract for September delivery on the Dalian Commodity Exchange gained 2.3% to 655.5 yuan.
Dalian coking coal ticked up 0.1% to 1,362 yuan, while coke futures advanced 0.7%to 2,167 yuan.
Comments
Comments are closed.