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Kallanish Kallanish

Knowledge matters Knowledge matters

November, 24th 2020

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OCT 23
10:42

Chinese rebar recovers on demand

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The Chinese rebar market saw a rise last week due to a boost in demand. A weaker performance for futures on Friday threatened to undermine the strong market, however, Kallanish notes.

In Shanghai on Friday afternoon, 20mm HRB400 rebar was trading at CNY 3,640-3,650/tonne ($546-547/t), up CNY 40/t from the previous week. On the Shanghai Futures Exchange, meanwhile, the rebar contract for January 2021 closed at CNY 3,616/t, which was CNY 26/t lower compared with Thursday and CNY 16/t lower than the previous Friday.

At the beginning of last week, the spot market maintained the slump of the previous week. However, the market began to pick up from the middle of the week, and demand increased. On Friday, most traders and end-use buyers were restocking for the weekend, so spot prices rose slightly.

Buyers are still sensitive to prices, however, and transactions decreased after prices rose. The news of Tangshan's production restrictions has also stimulated market confidence. However, due to the limited impact of these restrictions, they have not supported a price increase.