Steel futures stabilise after continuous losses
Chinese rebar and hot rolled coil futures have not rebounded even with some good news as low demand dominated sentiment. But they finally stabilised on Monday after rapid continuous declines last week, Kallanish notes.
On the Shanghai Futures Exchange, the most-traded October 2023 rebar contract closed just CNY 4/tonne lower than Friday at CNY 3,732/t ($519/t), and the same contract for HRC lost CNY 6/t to CNY 3,984/t.
CISA reports average daily steel production across its key members of 2.14 million tonnes in late-July, down 4.99% on-period but up 12.98% on-year. The figure was also the lowest level in the past two months, revealing that pressure from the government to cut production may have begun.
In the real estate market, second-tier Zhengzhou continues to be a pioneer in supportive measures. Individuals can now get the best available down payment ratios and loan rates as long as there is no real estate in their name, regardless of whether they have ever had a loan.
Four first-tier cities have also expressed their willingness to explore such mechanisms following the initiative of the Ministry of Housing and Urban-Rural Development, but no measures have been introduced so far. As a result, the market has calmed down after a flurry of excitement, and worries remain about whether the measures to lower the threshold for buying houses can support new starts and steel demand.
Also, Zhengzhou received support from the provincial government to explore limiting home sales to existing homes, instead of pre-sales before completion. This measure is intended to improve the mentality of buyers. However, the implementation of this measure will take time, and there is no official timetable.
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