Concerns over a rapid rise in steel production in recent weeks amid a fragile domestic demand recovery, and the prospect of intensified Covid-19 restrictions in China also weighed on the ferrous complex. The most-traded January rebar contract on the Shanghai Futures Exchange ended daytime trade 1.3% lower at 3,741 yuan ($537.07) a tonne, snapping a three-session rally.
Hot-rolled coil, which is steel used in producing home appliances and car bodies, fell 1.6% to 3,800 yuan a tonne, while stainless steel dropped 1.8% to 17,065 yuan a tonne.
Asian shares tumbled, the dollar held firm and two-year Treasury yields hit a new 15-year high, as a US inflation report dashed hopes for a peak in inflation, fuelling bets rates may have to be raised higher for longer.
“Overseas interest rate hikes are detrimental to global commodities,” analysts at Zhongzhou Futures said in a note. China is the world’s biggest producer and exporter of steel.
The most-active January iron ore contract on China’s Dalian Commodity Exchange dipped 0.7% to 720.50 yuan a tonne, also pulling back from a two-week peak. Coking coal and coke shed 0.6% and 0.1%, respectively. On the Singapore Exchange, benchmark October iron ore slumped 2.8% to $100.45 a tonne.
Production of LME deliverable KAS-branded aluminium at Kazakhstan’s Eurasian Resources Group has reached the four-million-tonnes milestone
