Steel rebar futures in China held near the CNY 2,950 per tonne on Wednesday, remaining in narrow range since touching a nine-month low of CNY 2,920 two sessions prior as poor ferrous metal demand and increasing protectionism against Chinese steel outweighed the outlook of lower supply.
Construction growth in China measured by the NBS PMI fell to a four-month low in May as tariff threats from the US limited consumption and an oversupply of housing stock pressured the need for new residential projects, magnifying the impact of lower seasonal activity in the summer. Additionally, the US doubled tariffs on steel imports to 50%, pressuring import demand and raising the availability of ferrous metal among major Asian hubs. This drove Beijing to signal it will cut capacity for steel furnaces and mills this year, with Baosteel stating it expects production to fall my 50 million tonnes.
