Steel reinforcement-bar futures climbed for a second day on expectations that government policies will spur urban development, boosting demand for the material used in housing and infrastructure.
Rebar for delivery in May rose 0.1 percent to 3,878 yuan ($622) per metric ton, the highest close for a most-active contract since July 16. Futures have lost 7.9 percent this year.
China’s smaller cities and towns will loosen controls on residency, the Shanghai Securities News reported today. Urbanization is expected to spur 40 trillion yuan of investment by 2020, the Southern Metropolis Daily reported yesterday, citing a draft plan by the National Development and Reform Commission on urbanization.
“China’s new leadership sees increased urbanization as the engine of growth and that’s driving rebar,” Ren Xinlei, an analyst at Luzheng Futures Co., said by phone from Jinan. Xi Jinping was named general secretary of the Communist Party last month. Demand will be stronger by March when the weather is warmer, Ren said.
The average spot price for rebar rose 0.3 percent to 3,621 yuan a ton, according to data from Beijing Antaike Information Development Co. Spot iron ore at Tianjin port was unchanged at $135.40 a dry ton on Dec. 24, data compiled by The Steel Index Ltd showed.