Sept. 13 (Bloomberg) -- Steel reinforcement-bar futures in Shanghai capped the biggest weekly decline since May as steel mills expanded production while demand remained lackluster.
Rebar for delivery in January on the Shanghai Futures Exchange dropped 1.5 percent to close at 3,657 yuan ($598) a metric ton, the lowest close for a most-active contract since Aug. 1. Futures slumped 1.8 percent this week, the most since the five days through May 31.
China’s crude steel output advanced in August as profitability rose, with production jumping to 66.3 million tons from 65.47 million tons in July, according to the National Bureau of Statistics. While September is usually a peak season for building material consumption, there are few signs now of strong season demand, said Dang Man, an analyst at Maike Futures Co. in Xi’an.
“End-users seem to have become cautious, so demand in the spot market looks sluggish,” Dang said. “Low inventory offers some support, but given the high mills output, there’ll be increasing pressure on the supply side.”
The average spot price of rebar fell 0.2 percent to 3,561 yuan a ton today, according to Beijing Antaike Information Development Co.
Iron ore for immediate delivery at Tianjin port was little changed at $135.20 a dry ton yesterday, according to a price index compiled by The Steel Index Ltd. The steel-making ingredient reached its five-month high at $142.80 on Aug. 14.
--Feiwen Rong. Editors: Sungwoo Park, Brett Miller