UpdateChina’s steel prices up over 15pc in rare rally after Beijing vows more easing measures to boost growth
But it remains to be seen if the thawing steel market reflects a broader economic recovery, analysts say
Steel prices in China have risen sharply over the past few days, showing signs of more positive investor sentiment and that the economy may be stabilising after Beijing promised more easing measures to help boost growth.
Prices of steel billet – a raw steel product that can be processed into bars, wires and sheets – in Hebei province’s Tangshan rose more than 15 per cent over the last three days. The jump prompted steel merchants and plants across the country, from Shanghai to Shenzhen, to raise their prices.
The price rebound came in tandem with a clear policy message from Beijing that the government would increase fiscal spending and monetary easing to help boost growth.
READ MORE: Beijing locks minimum growth at 6.5 per cent a year to underpin President Xi Jinping’s China dream
China has targeted at least 6.5 per cent annual growth for the next five years – an ambitious goal that will require strong fixed-asset investment at home as the export engine rapidly loses steam.
The factory-gate steel billet price in Tangshan was 2,060 yuan (HK$2,450) per tonne on Monday – a hefty increase from the 1,780 yuan per tonne last Friday – according to information on Mysteel.com, the Internet portal for China’s steel industry.
“Every day, the price is higher than yesterday,” said Zhang Mingkun, a sales manager at Xinyong Trade, a steel product merchant, in Tangshan.