China ferrous futures range-bound as COVID outbreak dents demand

Chinese ferrous futures drifted in a narrow range on Monday, as the recent COVID-19 outbreak dented peak seasonal demand while disrupting production and transportation as well.

Mainland China reported 2,027 confirmed coronavirus cases for March 20, including 1,947 locally transmitted, the country’s health authority said.

Hebei, the country’s top steelmaking province, had 51 cases for Sunday, with two reported in the steel manufacturing hub of Tangshan.

The Tangshan government has implemented traffic control and suspended all public transportation to avoid further infections.

“The pandemic outbreak in many regions has led to lower downstream demand, and logistics in some areas were disrupted,” analysts with SinoSteel Futures wrote in a note.

As the steel sector has entered the traditional peak season, the resurgent COVID cases could have a negative impact on consumption, they said.

The most-active steel rebar contract on the Shanghai Futures Exchange SRBcv1, for May delivery, dipped 0.02% to 4,923 yuan ($773.64) a tonne at close.

Hot-rolled coils SHHCcv1, used in cars and home appliances, inched up 0.6% to 5,132 yuan per tonne. Shanghai stainless steel futures SHSScv1 slipped 0.4% to 19,780 yuan a tonne.

Benchmark iron ore futures DCIOcv1 on the Dalian Commodity Exchange ended up 1% to 833 yuan a tonne. Spot 62% iron ore SH-CCN-IRNOR62 jumped $3.5 to $150 per tonne on Friday, according to SteelHome consultancy.

Coking coal futures on the Dalian bourse DJMcv1rose 1% to 3,019 yuan a tonne and coke prices DCJc1faltered 0.6% to 3,603 yuan per tonne.
Source: Reuters (Reporting by Min Zhang in Beijing and Enrico Dela Cruz in Manila; Editing by Subhranshu Sahu)