Jan. 6 (Bloomberg) -- Steel reinforcement-bar futures fell in Shanghai, extending a fourth weekly drop, as inventories increased amid slowing construction activity ahead of the Chinese New Year holiday.
Rebar for May delivery on the Shanghai Futures Exchange lost 0.7 percent to close at 3,515 yuan ($581) a metric ton. The most-active contract lost 2 percent last week.
Inventory of five major steel products in China gained 1.5 percent from a week earlier to 13.7 million tons as of Jan. 3, Zhengzhou-based Wanda Futures Co. said in a report today. Construction sites will be mostly closed by mid-January as migrant workers from the countryside return home for annual holidays, according to Weng Mingxiao, an analyst at Xinhu Futures Co. in Hangzhou.
“Demand has been noticeably declining, faster than adjustments in production,” said Weng. “As consumption continues to weaken across the country, rebar futures are finding less support from the spot market.”
Rebar for immediate delivery tracked by Beijing Antaike Information Development Co. fell 0.6 percent to 3,469 yuan a ton today.
Iron ore for May delivery on the Dalian Commodity Exchange dropped 1 percent to close at 893 yuan a ton. The contract for immediate delivery at the port of Tianjin tracked by The Steel Index was unchanged at $135 a dry ton on Jan. 3.
--William Bi. Editors: Jarrett Banks, Sungwoo Park