The price of steel in futures contracts on China rose on Tuesday, spurred on by the Chinese government's efforts to ease the financial crisis in the troubled local real estate sector, but iron ore prices fell on lingering concerns over falling demand for the steel ingredient at the world's biggest steelmaker.
China's real estate sector, which accounts for about a quarter of domestic demand for steel, has been in the spotlight amid a growing boycott of mortgage payments on unfinished real estate projects.
Chinese regulators have stepped up efforts to encourage lenders to lend to qualifying projects, acting to ease a turmoil that could overwhelm an economy already hard-hit by Covid-19 lockdowns.
Construction steel rebar on the Shanghai Futures Exchange ended trading up 1.7% at 3,774 yuan ($559.37) a tonne. The close was well below the session high of 3,872 yuan but extended a rally from the 19-month low reached on Friday.
Hot-rolled coil, used in car bodies and home appliances, rose 1.4% to RMB 3,755 per tonne, rebounding from a 20-month low.
The price of stainless steel rose 0.1%.
But steel raw material futures prices have fallen as the overall outlook for China's steel demand remains clouded by Covid-19 risks and bad weather.
The August iron ore contract on the Singapore Stock Exchange fell 2.5% to $98.20 a tonne, while the most traded September contract for the product in Dalian fell 1% to RMB 656.50 a tonne.
Sources: investing.com
