Steel-reinforcement bar futures advanced to the highest level in more than seven months as data showed that manufacturing expanded for a fourth consecutive month in China, the biggest consumer.
The contract for delivery in May climbed as much as 0.4 percent to 4,144 yuan ($665) a metric ton on the Shanghai Futures Exchange, the highest most-active price since June 20. Rebar closed at 4,134 yuan for the mid-day break at 11:30 a.m. local time, extending this week’s advance to 1.4 percent for a third straight weekly gain.
The Purchasing Managers’ Index was 50.4 in January, the National Bureau of Statistics and China Federation of Logistics and Purchasing said, as they more than tripled the number of companies surveyed to 3,000. The reading compares with the 51 median estimate in a Bloomberg News survey and 50.6 in December. A figure above 50 indicates expansion.
“The data are positive to commodities, but we should also bear in mind that the recent rally of rebar has factored in much of the expectation of a recovery,” said Huang Huiwen, an analyst at Shanghai CIFCO Futures Co.
A separate gauge from HSBC Holdings Plc and Markit Economics covering fewer businesses showed manufacturing increased to a two-year high of 52.3 in January from 51.5 a month earlier.
The average spot price for rebar rose 0.1 percent to 3,755 yuan a ton today, according to data from Beijing Antaike Information Development Co. Spot iron ore at Tianjin port climbed 2.1 percent to $152.50 a dry ton yesterday, according to The Steel Index Ltd.
The benchmark iron ore price will be in the range of $130- $150 a ton in 2013, as delivery disruptions will probably result in supply losses of 5 million tons to 10 million tons in the first quarter, Henry Liu and Shirley Zhao, analysts with Mirae Asset Securities (HK) Ltd., said in a report today.
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