JOIN USRobust demand, supply curbs push China steel prices to record peaks
China steel prices jumped to record highs on Tuesday, boosted by strong domestic demand and concerns over supply curbs in the world's biggest producer and exporter of the construction and manufacturing material.
Construction steel rebar's May contract on the Shanghai Futures Exchange ended the daytime trading session 2.1 per cent higher at 5,180 yuan ($791) a tonne, after earlier climbing to 5,200 yuan, the highest on record or since 2011.
Hot-rolled coil, which is steel used in car bodies and home appliances, rose 0.9 per cent to 5,566 yuan a tonne, after earlier touching 5,589 yuan, its loftiest since trading began in 2014.
Production restrictions in China's top-steelmaking city of Tangshan during the peak demand season have brought down stocks at commercial warehouses and created a "bullish atmosphere" for the market, Sinosteel Futures analysts said in a note.
Last Thursday, China's state planner and industry ministry announced planned inspections to check on implementation of steel capacity cuts in the country's production centres and reiterated its intention to curb output further in 2021 to reduce emissions.
In a meeting on April 3, the Tangshan government asked mills to speed up emission reduction and warned of suspension if they fail to meet the level of progress required by June 15, and vowed to introduce specific emission requirements for the sector soon.
Iron ore futures on the Dalian Commodity Exchange fell, with the steelmaking ingredient's most-traded September contract down 0.6 per cent at 971 yuan a tonne.
On the Singapore Exchange, the most-active May contract rose 0.3 per cent to $161.25 a tonne.
Spot iron ore from top supplier Australia for delivery to China <SH-CCN-IRNOR62> traded at $168 a tonne on Friday, latest data available from SteelHome consultancy on Refinitiv Eikon showed.
Dalian coking coal edged up 0.3 per cent, while coke slipped 0.2 per cent.
Shanghai stainless steel advanced 0.6 per cent.