Steel reinforcement-bar futures in Shanghai rose today as an unexpectedly strong expansion of Chinese exports fueled expectations that industrial activity will increase.
Rebar for delivery in May gained as much as 0.8 percent to 4,030 yuan ($646) a metric ton on the Shanghai Futures Exchange, before trading at 4,019 at 10:47 a.m. local time. The most- active contract reached 4,047 yuan on Jan. 7, the highest level since July 10.
China’s exports rose 14.1 percent in December from a year earlier while imports increased 6 percent, producing a trade surplus of $31.6 billion, the customs administration said today. The pickup in overseas shipments compares with the 5 percent median estimate of 40 analysts in a Bloomberg News survey.
“China’s export sector is improving,” Dang Man, analyst at Maike Futures Co., said in a report today. “Steel prices’ downside is limited because the market now expects demand from the downstream industries to pick up.”
Prices surged 14 percent in December, the most since July 2009, as China’s economy headed for a rebound in the final three months of the year after a seven-quarter slowdown as the government increased infrastructure spending and accelerated investment-project approvals.
Spot iron ore at Tianjin port was unchanged at $158.50 a dry ton yesterday, matching the day before, when it reached the highest level since Oct. 13, 2011, data compiled by The Steel Index Ltd. showed. The average spot price for rebar was at 3,774 yuan a ton yesterday, unchanged from Jan. 7 when it reached the highest level since Oct. 15, according to data from Beijing Antaike Information Development Co.
To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at firstname.lastname@example.org