Shanghai rebar ended April lower due to a slow start to a seasonally busy period for construction activity in China, but could improve in May. "There are expectations that underlying demand will see some improvement after the May holiday so there should be some restocking demand," said CRU consultant Kevin Bai.
Chinese markets are shut on May 1 for the Labour Day holiday. The most-active rebar on the Shanghai Futures Exchange closed up 4.4 percent at 3,115 yuan ($452) a tonne, just off the session's peak of 3,116 yuan, its strongest since April 7. It dropped 3.2 percent for the month. But the construction steel product gained 5 percent this week on unconfirmed market talk of possible production curbs in areas surrounding Beijing, including top steel-producing province Hebei, ahead of a mid-May summit in the capital.
A steel mill in Hebei has not received any government notice yet on production cuts, said an official at the mill who declined to be named because he is not authorised to speak to media. The recovery in steel futures has boosted sentiment in the physical market, lifting spot prices, said Bai. The most-traded iron ore on the Dalian Commodity Exchange jumped 4.5 percent to end at its session high of 521 yuan per tonne.
On Thursday, iron ore for delivery to China's Qingdao port slipped 0.3 percent to $66.42 a tonne, according to Metal Bulletin. The spot benchmark has lost 17.4 percent this month, on course for its steepest monthly drop since May 2016.
Copyright Reuters, 2017