China steel prices hit one-week highs on bullish industrial production data
Band Enrico Dela Cruz
December 15 (Reuters) – Chinese steel futures jumped to their highest level in a week on Wednesday, after data showed industrial production of the world’s largest producer rose faster than expected in November, but a continued decline of steel production resulted in Dalian iron ore.
The most active May contract for structural steel rebar on the Shanghai Futures Exchange SRBcv1 rose 1.7% to 4,468 yuan ($ 702) per ton, its strongest since Dec. 8.
Hot rolled coil SHHCcv1, which is the steel used in car bodies and household appliances, climbed 2.4% to 4,650 yuan per ton, its highest level since Dec. 8.
Factory output rose 3.8% in November from a year earlier, following a 3.5% increase in October, according to official data, supported by stronger energy production and moderation in energy costs. commodity prices.
But crude steel production fell for the sixth consecutive month in November, falling 3.2% from October, as production restrictions to tackle pollution continued and construction demand remained stagnant.
The most traded May contract on the Dalian commodity exchange DCIOcv1 for iron ore, a key ingredient in the steel industry, fell to 2.6%.
The most active January contract on the Singapore stock exchange SZZFF2 was up 0.1% to $ 113 by 3:38 a.m. GMT, after rising 1.6% earlier in the session.
âChina’s political landscape at the macro level, including moves towards decarbonization, remains a cap on the medium-term demand outlook for iron ore,â ING analysts said in their 2022 outlook for iron ore. raw materials.
They expect iron ore prices to sag to $ 100 per tonne in 2022, “the main upside risks still being potential supply chain disruptions in light of the Omicron variant.” .
Spot iron ore in China rose to $ 115.50 a tonne on Tuesday, the highest since October 28, but only halfway from a record high reached in May, according to data from consultancy SteelHome . SH-CCN-IRNOR62
Shanghai stainless steel SHSScv1 increased by 1.4%.
dalian coking coal DJMcv1 gained 0.4%, while coke DCJcv1 advanced by 1%.
(Reporting by Enrico Dela Cruz in Manila; Editing by Subhranshu Sahu)
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