Iron ore futures rebounded to CNY 795 per tonne from the two-month low of CNY 770 touched on March 10th, tracking other assets that benefit from higher economic activity in China after officials in Beijing announced they will implement a batch of measures to boost consumption. Besides the support for manufactured goods, the measures are expected to combat China's prolonged property crisis and prevent more developers from being liquidated, which are among the world's top steel consumers. Still, expectations that steel output may slow this year capped a higher rebound. The Chinese government stated they will cut capacity for steel producers, speculated by markets to equivalate cuts of around 50 million tons of steel per year. The capacity caps would target increasing concerns of overcapacity among blast furnaces and mills, stemmed by lower construction demand due to the country’s property crisis and a decreasing ability to offload steel to foreign customers.
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