Rebar Falls First Day in Four Amid Higher Steel Supply

Steel reinforcement-bar futures in Shanghai fell for the first time in four days as China’s steel output climbed, raising supply concerns.

Rebar for delivery in January on the Shanghai Futures Exchange fell 0.5 percent to close at 3,606 yuan ($591) a metric ton. The most-active contract has declined 9.6 percent this year.

China’s average daily crude steel output rose to 2.15 million tons in late September from 2.14 million tons in mid-September, Shanghai-based Xiben New Line said in a statement on its website, citing data from the China Iron & Steel Association. That was the highest average daily output in three months, it said.

“Output by steel mills gathered pace, stoking supply concerns,” said Dang Man, an analyst at Maike Futures Co. in Xi’an.

China will reduce overcapacity in the steel sector by an additional 15 million tons by 2015, according to a State Council statement posted on the central government website after the market closed today.

China’s Dalian Commodity Exchange will start trading the country’s first iron ore futures for physical delivery on Oct. 18, the bourse said in a statement on its website yesterday.

Iron ore for immediate delivery at Tianjin port gained 0.4 percent yesterday to $133.60 a dry ton, according to a price index compiled by The Steel Index Ltd. The spot price of rebar was little changed at 3,520 yuan today, according to Beijing Antaike Information Development Co.

— With assistance by Feiwen Rong

(Corrects steel sector capacity cut in fifth paragraph.)
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