Steel reinforcement-bar futures climbed to the highest level in more than five months on expectations that China’s investments in railways and urbanization will boost demand for the construction material.
Rebar for delivery in May rose as much as 2.1 percent to 3,958 yuan ($635) a metric ton on the Shanghai Futures Exchange, the highest most-active price since July 10. Futures were at 3,885 yuan by the midday break, extending this month’s advance to 11 percent and trimming the 2012 loss to 7.7 percent.
Railroad construction investment may be 1.8 trillion yuan between 2013 and 2015, China Securities Journal reported today, citing the National Development and Reform Commission’s Institute of Comprehensive Transportation. The investment needed in 2013 may be as much as 650 billion yuan, the newspaper said. The housing and urban-rural development ministry told local governments to complete renovation of large run-down urban areas by end-2015, Xinhua reported yesterday, citing a circular.
“The government is determined to spend more money on infrastructure and urban development,” Wu Zhili, an analyst at Shenhua Futures Co., said by phone from Shenzhen.
China’s urbanization is expected to spur 40 trillion yuan of investment by 2020, the Southern Metropolis Daily reported on Dec. 25, citing a draft plan by the NDRC.
The average spot price for rebar rose 0.3 percent to 3,621 yuan a ton yesterday, 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.