China’s benchmark construction steel futures extended losses into a fifth session on Friday, with lukewarm demand in spot markets continuing to weigh on sentiment.
The most-traded steel rebar contract, for October delivery, on the Shanghai Futures Exchange had dipped 0.3 percent to 3,532 yuan ($552.95) a tonne by 0214 GMT.
“Prices of physical steel products have fallen sharply amid waning trading volumes ... which suppressed market sentiment and may keep steel prices at a low level,” analysts from CITIC Futures said in a note in Mandarin, adding that total trading volume across the country had been declining for four days.
Spot steel product prices fell 0.5 percent to 4,276.22 yuan a tonne on Wednesday, a level not seen for nearly three weeks, data from Mysteel consultancy showed.
Steelmaking raw materials continued to drop on Wednesday, alongside steel prices, with coke falling for a sixth day.
“Mills are not active in replenishing their stockpiles at the moment, as they plan to restock when prices fall further,” said a Shandong-based coke trader. He declined to be identified as he was not authorised to speak with media.
The most-traded coke futures on the Dalian Commodity Exchange sank 0.7 percent to 1,971 yuan a tonne after plunging as much as 4.8 percent in the previous session.
Coking coal prices declined 0.8 percent to 1,181.5 yuan a tonne.
Dalian iron ore futures rose for the first time in six sessions on Thursday, edging up 0.7 percent to 457.5 yuan a tonne.
“Iron ore prices have already fallen to a low level ... and the market thinks there is only limited room for prices to decline further,” said the analysts at CITIC Futures.
Source: Reuters