FX.co ★ Steel Rebounds on Demand Hopes

Steel rebar futures experienced an uptick, surpassing CNY 3,080 per ton, as they rebounded from recent multi-week lows. This movement was fueled by optimism regarding an enhanced macroeconomic environment potentially boosting demand. The markets are preparing for a potential interest rate cut by the US Federal Reserve, while attentiveness grows towards signals from China's upcoming Central Economic Work Conference. At this event, policymakers are expected to set growth targets and outline policy plans for the forthcoming year. In spite of Beijing’s efforts to curb overcapacity, Chinese steel mills have maintained an active approach to restocking raw materials, buoyed by robust international demand for steel. Notably, China's steel exports increased by 2% from the previous month, reaching 9.98 million tons in November, marking a 7.5% rise compared to the same period last year. Cumulatively, exports for the year have hit a record 107.72 million tons, reflecting a 6.7% year-on-year growth. Concurrently, steel prices have come under pressure, as recent industry data reveals that only 35% of Chinese steel mills were profitable at the end of November, which is a decline from the 45% profitability observed in late October.