China’s domestic rebar prices surged on Monday May 10 and broke its historical high after the October futures contract hit the limit within ten minutes of trading.
Eastern China (Shanghai): ۶,۰۰۰-۶,۰۳۰ yuan ($933-938) per tonne, up by 580 yuan per tonne
Monday’s prices surpassed the previous record high set on May 16, 2008, when prices reached 5,460-5,730 yuan per tonne.
The weekend rise in billet and strong rebar futures prices were the main factors behind the higher prices.
In addition, the environmental inspections carried out in the provinces of Shandong and Shaanxi have led to expectations of lower steel production, pushing prices up further, sources said.
Rebar demand in May is typically strong, so prices may remain at high levels, according to market sources.
Trading activity was much higher on Monday, compared with Friday, spurred by the rise in futures and spot prices.
Buyers raised their procurement rates on concerns that prices will increase further, a trader in Shanghai said.
Market chatter ***
“The national investment after the Covid-19 pandemic increased capital flow in the market, which is one reason that commodity prices have moved up continually, including steel products. This factor will remain as a support for steel prices for the rest of this year,” an industry analyst said.
As of 3pm, billet was trading at 5,650 yuan per tonne including value-added tax in Tangshan, up by 460 yuan per tonne from Friday.
Shanghai Futures Exchange ***
The most-traded October rebar futures contract closed at 6,012 yuan per tonne on Monday, up by 334 yuan per tonne from Friday.
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