BEIJING: Chinese steel futures hit all-time highs on Monday, underpinned by robust demand and concerns over production curbs, while benchmark iron ore prices hit record highs, fuelled by structural supply shortage.
The northwest Shaanxi province recently urged local departments, as requested by China’s state planner and other authorities, to verify local steelmakers’ crude steel output in 2020 and explain those whose production exceeded designated capacity or didn’t meet it.
Another major steelmaking city Handan in the Hebei province recently issued a notice, asking mills to implement production-control measures in the second quarter.
The measures have sparked concerns of more curbs in the ferrous sector, lifting prices as demand is still strong during the peak season.
The most-active construction rebar on the Shanghai Futures Exchange, for October delivery, rose as much as 4.3% to a record of 5,475 yuan ($844.02) a tonne. The contract gained 2.7% to 5,387 yuan as of 0246 GMT.
Hot-rolled coils, used in cars and home appliances, jumped 3.0% to 5,729 yuan a tonne. The sky-rocketing steel prices also underpinned steelmaking ingredients.
Iron ore futures on the Dalian Commodity Exchange, for September delivery, was up 4.1% at 1,142 yuan a tonne, after jumping as much as 6.3% - a record high.
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