Rebar Declines to One-Month Low on Iron Ore Price, Mill Output
Steel reinforcement-bar futures in Shanghai fell to the lowest in a month as a drop in iron ore prices and rising output from mills encouraged selling.
Rebar for January delivery on the Shanghai Futures Exchange fell as much as 0.6 percent to 3,711 yuan ($606) a metric ton, the lowest level for a most-active contract since Aug. 7. Futures traded at 3,722 yuan at 10:46 a.m. local time and have declined 0.8 percent this week.
Iron ore for immediate delivery at Tianjin port fell 0.7 percent yesterday to $137.10 a dry ton, the lowest price since Aug. 7, according to a price index compiled by The Steel Index Ltd. Chinese steel mills’ daily crude steel output reached an average 2.1 million tons in the first 20 days of August, compared with 1.9 million tons at the end of 2012, according to China Iron and Steel Association.
“The steel mills’ output remained at a high level, which will slow the destocking process in the market,” said Wu Zhili, an analyst at Shenhua Futures Co. in Shenzhen. “Rebar prices are under pressure from both high output and lower raw material prices.”
To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at firstname.lastname@example.org