Iron ore futures rebounded from previous trading day losses and closed higher at the afternoon session.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE), rose by 5.55% day-on-day or up RMB 57.50 to RMB 1,093.50/mt on Thursday.
The steel rebar contract on the Shanghai Futures Exchange followed the rally and hiked up by 1.96% or RMB 90 day-on-day to RMB 4,687/mt.
Steel prices stabilize amid output restriction
Despite higher rebar futures, China’s rebar prices slipped for the second consecutive trading day, according to Mysteel’s data.
The country’s rebar price of HRB400 20mm dia rebar reached RMB 4,696/mt as of Mar 10, down RMB 43/mt on-day, however the daily sales volume of construction steel including rebar recovered 4.9% on-day to 164,316 mt per day.
The price decline was due to market uncertainty over steel outlook as trade participants waited for more details on steel-related policies from the Two Session meetings.
Meanwhile, the prices of Tangshan billets steadied at RMB 4,290/mt on Thursday, unchanged day-on-day, after losing a total of RMB 120/mt since the start of the week.
Lower average operating rate in Tangshan
Tangshan’s average operating rate of blast furnace dropped to 73.3% during Mar 4-10 period, down 17.1% on-week, according to Mysteel.
The steel consultancy firm estimated around 18 blast furnaces belonging to 12 steel mills had been scheduled for maintenance to comply with stricter environmental regulation to cut air pollution.
The anti-air pollution measures were in line with the Beijing policymakers’ effort to cut carbon emission by encouraging more steel imports and sintering cuts in mills.