August 8, 2018 / 2:57 AM / 8 months ago

Shanghai rebar dips from six-year high; trade spat escalates

* Rebar open interest falls to lowest in 4 months

* U.S. finalised next China tariff list on Aug.23

BEIJING, Aug 8 (Reuters) - China’s Shanghai rebar pulled back on Wednesday after reaching a more than six-year peak in the previous session, as traders worried high prices may not be supported by physical demand, just as a trade row with Washington heats up.

Benchmark construction rebar steel prices on the Shanghai Futures Exchange edged down 0.1 percent to 4,236 yuan ($620.96) a tonne as of GMT 0213.

Rebar hit a high on Tuesday of 4,266 yuan a tonne, the highest since April 2012, on short-covering. Open interest, or the number of positions held by investors, fell to 2.2 million lots by market close, the lowest since late March. One lot equals 10 tonnes.

“Summer remains the off-peak season for steel demand. Downstream users are tending to be cautious when purchasing steel products with prices reaching a fresh record,” said analysts from Sinosteel Futures in a note.

“There is not enough momentum to push prices higher without support from actual trading.”

On Tuesday, the United States said it will begin collecting 25 percent tariffs on another $16 billion in Chinese goods on Aug. 23, the latest move to put pressure on China to negotiate trade concessions.

The most-active iron ore futures on the Dalian Commodity Exchange also fell after three days of gains, dipping 0.2 percent to 503.5 yuan a tonne.

The city of Xingtai in Hebei province, China’s No.1 steelmaking province, said it had ordered steel mills, coke producers and utilities to cut production from Aug.15 to reduce harmful emissions, potentially curbing demand for steelmaking raw materials.

Ratings agency Fitch said it expected the wider premiums being paid in China for high-quality iron ore and coking coal to persist in the short-term, but expects the gap to discounted to tighten over time.

Dalian coking coal fell 1.1 percent to 1213.5 yuan a tonne on Wednesday. Coke futures dipped 1.8 percent to 2,430.5 yuan a tonne.

$1 = 6.8217 Chinese yuan renminbi Reporting by Muyu Xu and Josephine Mason

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below