Rebar futures slide after China announces ‘supervisory’ role in iron ore market

A sudden downturn in rebar futures on the SHFE put pressure on spot prices on Wednesday February 9, after a slump in iron ore futures was sparked by news that the Chinese authorities plan to strictly supervise speculation about the iron ore market

Domestic

Eastern China (Shanghai): 4,860-4,900 yuan ($764-770) per tonne, widened downward by 10 yuan per tonne

China’s National Development & Reform Commission (NDRC) announced early on Wednesday that it would be taking a supervisory role in monitoring speculation and “fake news” in the iron ore market, leading to a sharp decline in iron ore futures.

The most-traded May iron ore futures contract on the Dalian Commodity Exchange closed the Wednesday trading session at 781 yuan per tonne, down by 40 yuan per tonne from Tuesday.

The iron ore losses led to bearish sentiment in steel futures, including rebar, which led some sellers in the spot market to lower their rebar offers.

And some rebar buyers withdrew orders completely to wait for further future price drops, sources told Fastmarkets.

Market chatter

“Iron ore prices will be under pressure [because of] the supervision, so rebar prices are likely to see smaller fluctuations than they typically do after the Lunar New Year holiday,” an industry analyst said.

Fastmarkets’ price assessment for steel reinforcing bar (rebar) domestic, ex-whs Eastern China was at 4,860-4,880 yuan per tonne on March 31 2021, up by 580 yuan per tonne (13.50-13.60%) from 4,280-4,300 on February 5, the last transaction day before Lunar New Year of 2021.

Billet

As of 3pm, steel billet was being traded at 4,670 yuan per tonne including value-added tax in Tangshan on Wednesday, up by 20 yuan per tonne from the previous day.

Shanghai Futures Exchange

The most-traded May rebar futures contract closed at 4,843 yuan per tonne on Wednesday, down by 69 yuan per tonne from Tuesday.

What to read next
US President Donald Trump has reinstated the full 25% steel tariffs under Section 232. This decisive move aims to curb surging imports and bolster US manufacturing. With exemptions removed and impacts stretching from producers to downstream manufacturers, the global steel industry braces for widespread effects.
US President Donald Trump’s decision to impose 25% tariffs on imports of steel products into the US has generated a strong reaction in the EU, with market sources expecting a domino effect and a subsequent trade war, Fastmarkets heard on Tuesday February 11.
Fastmarkets proposes to amend the load port of its hard coking coal and pulverized coal injection (PCI) spot prices, fob DBCT, to fob eastern Australian ports, from the current basis of Dalrymple Bay Coal Terminal, Australia.
The amendment would decrease publishing frequency to twice per week from daily, to reflect lower market liquidity following Russia’s invasion of Ukraine in 2022 and resulting in Western sanctions against Russia that led to lower export sales volumes from the country. This is also while the effect of the war has resulted in lower sales […]
The impact of the US’ breakneck flip-flop on immediate 25% tariffs on Mexican and Canadian goods this week is adding confusion to a North American steel market long-starved of certainty, sources told Fastmarkets.
U.S. tariffs on Mexico shape global trade dynamics, impacting products and prices on both sides of the border.