SMM daily comment on domestic rebar market (Aug 22)

SHANGHAI, Aug 22 (SMM) –

Rebar futures prices fluctuated upward and closed up 1.58% at 3,723 yuan/mt. Affected by market news, the raw material prices rose sharply, and the market sentiment was high, driving up rebar prices. According to SMM research, the output reduction of rebar caused by maintenance this week will be 701,700 mt, an increase of 12,700 mt WoW. So, supply may decrease within the week. The active trading atmosphere and rising downstream procurement enthusiasm led to acceptable transactions throughout the day. Towards the end of the off-season, the profits of blast furnaces and electric furnace steel mills didn’t show obvious improvement, providing less driving force for supply growth. The influence of rainy weather weakened, so the demand is expected to improve. The price rise is mostly driven by market sentiment and speculative activities. In addition, local government special refinancing bonds are expected to be released, so short-term steel prices may continue to fluctuate.