Chinese steel futures fell for the third straight session on fears of weaker demand next year as prices for steel raw materials, coking coal and coke retreat.
Highlighting weak consumption, leading steel mill Baoshan Iron & Steel Co Ltd said Monday it will cut prices for its key products for January delivery. Wuhan Iron and Steel Co also cut its January prices.
Construction rebar prices on the Shanghai Futures Exchange fell 0.5 percent to 3,327 yuan ($ 484) a tonne.
Hot rolled steel used in production fell 0.1 percent to 3,309 yuan.
Citing declining auto sales and weak growth in infrastructure investment, Argonaut Securities analyst Helen Lau said she expects steel demand in China to slow in 2019.
If steel exports from China remain weak, “it will increase the risks of oversupply in the domestic market,” she said.
In January-November, steel supplies to China fell by almost 9 percent, to 63.78 million tons.
“This continuous decline in steel exports occurred when the yuan was at a depreciating level this year. This shows that currency depreciation could not help China's steel exports, ”Lau said.
The drop in steel prices came even after leading steel city Tangshan ordered steel mills and other industrial enterprises to further cut production this month as part of emergency measures to tackle smog.
Steel prices in China increase losses due to slowdown in demand
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Azovpromstal® 13 December 2018 г. 11:20 |
