Steel reinforcement-bar rose on optimism that demand for the material used in housing and railroads will increase as large construction projects in northern China resume operations after winter.
The contract for delivery in October rose as much as 0.9 percent to 3,916 yuan ($630) a metric ton on the Shanghai Futures Exchange, and traded 3,908 yuan at 10:15 a.m. local time. Futures have declined 9.1 percent since reaching a 10- month high of 4,297 yuan on Feb. 8.
Building projects including railroads and new apartment blocks are reopening in the next two weeks, according to a research report today by Luzheng Futures Co. Inventories of steel building materials including rebar fell 2 percent from March 15 to 22.1 million tons, the report said.
“We are seeing signs of returning demand across the country and declining inventory attests to that,” Ren Xinlei, analyst at Luzheng Futures, said by phone from Jinan in eastern China. Resumption of construction activities, delayed about two weeks by an unusually cold winter, should boost rebar prices, he said.
The average spot price of rebar was little changed at 3,672 yuan a ton yesterday, according to Beijing Antaike Information Development Co. Spot iron ore at Tianjin port rose 0.8 percent to $137.1 a dry ton yesterday, according to The Steel Index Ltd.
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