Steel reinforcement-bar futures extended the biggest weekly climb in more than two years on speculation that a reviving economy in China will boost demand for the material used in housing and infrastructure.
Rebar for May delivery rose 0.6 percent to 3,679 yuan ($590) a metric ton on the Shanghai Futures Exchange, the highest price at close since Nov. 1. Futures climbed 4.6 percent last week, the most since the week ended Oct. 15, 2010.
Daily crude steel output of major steel companies in late-November rose 0.5 percent to 1.64 million tons compared with the daily output in mid-November, data by China Iron & Steel Association show. Industrial production climbed 10.1 percent in November from a year earlier and retail sales growth accelerated to 14.9 percent, while inflation was 2 percent, the National Bureau of Statistics said.
“It will be difficult for steelmakers to trim production or lower prices given so much optimism in the economy,” Zhang Xin, analyst at Yongan Futures (Shenyang) Co., said by phone from Shenyang. “We have to watch if the property market sees real recovery or if this is just a flash in the pan,” he said.
The spot price of rebar rose 0.1 percent to 3,553 yuan a ton today, according to data from Beijing Antaike Information Development Co. Spot iron ore advanced 2.2 percent to $121 a dry ton at Tianjin port on Dec. 7, the highest in three weeks, according to data from The Steel Index Ltd.