Feb. 21 (Bloomberg) -- Steel reinforcement-bar futures in Shanghai fell for a second day as the Chinese government moved to curb property speculation, reducing demand for the building material.
Rebar for delivery in October fell by 2.1 percent to 4,085 yuan ($655) a metric ton on the Shanghai Futures Exchange, the lowest close in almost a month. The contract has dropped 4.4 percent this week as investors returned to the market after China’s Lunar New Year holiday.
Premier Wen Jiabao called on local authorities to “decisively” cut real estate speculation and rein in prices that surged the most in two years last month.
“We think some targeted measures regarding the property sector could be implemented as early as April for a few large cities if sales and prices continue to rise rapidly,” Wang Tao, chief China economist at UBS AG in Hong Kong and a former International Monetary Fund researcher, said in an e-mailed report today.
The average spot price for rebar was little changed at 3,881 yuan yesterday and has gained 2.4 percent this week, according to Beijing Antaike data. Spot iron ore at Tianjin port rose 0.6 percent to $158.90 a dry ton yesterday, according to The Steel Index Ltd., extending this week’s advance to 2.5 percent.
Cities that have had “excessively fast” price gains should promptly impose home-purchase restrictions if they’ve not done so already, according to a statement released yesterday after a State Council meeting headed by Wen. Provincial capitals and municipalities reporting directly to the central government should also publish annual price control targets to keep new- home costs “basically stable,” according to the statement.
--Feiwen Rong. Editors: Brett Miller, Jarrett Banks