BEIJING (Reuters) - China’s iron and steel futures mixed on Monday as investors continued to fret about slowing economic growth amid escalated trade tension between Washington and Beijing.
The world’s two largest economies appeared at a deadlock over the trade negotiations on Sunday as Washington demanded promises of concrete changes to Chinese law and Beijing said it would not swallow any “bitter fruit” that harmed its interests.
Benchmark Shanghai rebar prices dipped 0.5 percent to 3,716 yuan ($544.70) a tonne as of 0150 GMT.
Hot-rolled coil futures dipped 0.8 percent to 3,642 yuan a tonne.
“Supply remains staying at a high level as mills dash to cash in fat profit, meanwhile production restriction in Tangshan is lenient than market expectation,” said analysts from CITIC Futures in a note in Mandarin.
Government of Tangshan, China’s top steelmaking city, ordered steel mills to halt operations by an average of 30 percent in May in order to improve air quality in the region.
Analysts also warned of waning demand in the coming weeks as southern part of China will soon enter the raining season.
Jiangsu Shagang Group, the biggest private-owned steel maker in the country, lowered spot prices of some steel products by 50 yuan a tonne for June delivery, while Wuhan Iron and Steel, a subsidiary of China Baowu Group, maintained its May prices for June.
The most-traded iron ore contract on the Dalian Commodity Exchange rose 1.1 percent to 654 yuan a tonne.
Chinese steelmakers are regaining their appetite for high-grade iron ore despite record-high ore prices, mill managers and traders say, as recovering profit margins spur plants to seek efficiency gains and ramp up output.
Inventory of imported iron ore has fallen to their lowest since October 2017 to 133.6 million tonnes, according to data from consultancy SteelHome.
Dalian coking coal prices stayed little changes at 1356.5 yuan a tonne, while Dalian coke fell 0.6 percent to 2,146.5 yuan.
($1 = 6.8221 Chinese yuan renminbi)
Reporting by Muyu Xu and Shivani Singh; Editing by Rashmi Aich