Dec. 25 (Bloomberg) -- Steel reinforcement-bar futures dropped to the lowest level in more than five weeks on concern that China’s second cash crunch this year will slow the pace of economic growth, reducing demand for the construction material.
Rebar for May delivery on the Shanghai Futures Exchange lost 0.7 percent to 3,603 yuan ($593) a metric ton, the lowest close for the most-active contract since Nov. 18. Prices have dropped 9.7 percent this year.
The People’s Bank of China saw the seven-day interbank repurchase rate rose for a seventh straight session on Dec. 23. Higher volatility in money-market rates and difficulty in obtaining funds among some lenders risk hindering economic growth, already poised to slow to a 24-year low next year.
“Anxiety over liquidity have raised fear in investors, and some have responded by withdrawing from rebar,” Ren Xinlei, an analyst at Luzheng Futures Co., said by phone from Jinan in eastern Shandong province.
China’s economy will expand 7.4 percent in 2014, according to the median estimate of 48 analysts surveyed by Bloomberg News from Dec. 18-23. That would be the slowest pace since 3.8 percent in 1990.
Iron ore for May delivery on the Dalian Commodity Exchange gained 0.3 percent to 903 yuan a ton. The raw material for immediate delivery at the port of Tianjin tracked by The Steel Index was little changed at $132 a dry ton yesterday.
Rebar for immediate delivery tracked by Beijing Antaike Information Development Co. was little changed at 3,519 yuan a ton today.
--William Bi. Editors: Ovais Subhani, Brett Miller