Iron ore futures continued to rally on better economic indicators from China, despite market concerns over slower restocking activities and rising coronavirus cases in Hebei.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) then, rose by 1.65% on-day or RMB 17.50 to RMB 1,075/mt on Monday.
The steel rebar contract on the Shanghai Futures Exchange moved in a flattish manner and gained slightly by 0.55% or RMB 24 day on-day to RMB 4,392/mt.
China’s GDP grows at 2.3% in 2020, avoiding global coronavirus-hit recession
China’s economy had made a V-shaped recovery and might be the only world major economies to record positive GDP growth for the coronavirus-hit 2020.
Thus, the country’s GDP reached a growth of 2.3% for 2020, a 44-year low since the negative growth recorded in 1976 at the aftermath of the Cultural Revolution.
The last quarterly growth contributed much to the high annual reading, which recorded at a high 6.5% growth for Q4 2020, according to the National Bureau of Statistics (NBS).
Chinese policy of infrastructure stimulus had accelerated the growth, while the high industrial production and rising retail sales also attributed to the growth at year-end.
Chinese crude steel output reaches record-high of 1.1 billion mt in 2020
China produced 1.1 billion mt of crude steel in 2020, a record-high and up 7.7% year-on-year, according to the country’s National Burea of Statistics.
The growth was contributed to high steel consumptions, especially in construction steels as the country’s policymakers tried to kickstart the coronavirus-hit economy with infrastructure stimulus program.
For 2021, China’s rebar consumption is expected to grow by 2.7% or 7.6 million mt year-on-year to 293 million mt, according to Mysteel.
Meanwhile, China has also a long-term goal in becoming self-sufficiency in steel making at around 45% by increasing the usage of domestic iron ore and scrap by 2025, according to the country’s Ministry of Industry and Information Technology (MIIT).