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The rebar price is rising in China since Nov..      [2017-12-12]

Through a bull market in November, domestic rebar price has gone up substantially with the spot price in Shanghai hitting a new high of RMB5000/t ($755.23/t) ever since the plunge in 2011. The inventories have reached a new low since 2009. Affected by the limited production in the heating season of winter, the utilization rate of the blast furnace continues to go down by 78.2% nationwide with a decrease of 0.51% MoM. Prices of various grades have uniformly leapt, and the gross profit per ton has continued to rise, reaching RMB1944/t ($293.63/t) for rebars. Due to peak load shifting production in the heating season, steel traders’ reluctance to sell leads to a large influx of hot money in the stock market. It is reported that some traders who have switched jobs for many years have entered the market this year. From the supply side, limit of production results in a drop in supply. Take Anyang city in central Henan province for an example. There are 11 steel mills in Anyang. Except Anyang Steel which should limit production to the maximum, the other 10 mills are even requested to shut down. In eastern Jiangsu province, Shagang owned Huaigang is asked to reduce the production by half.