FX.co ★ Steel Rises Amid China Output Curbs

Steel rebar futures rose above CNY 3,070 per ton, approaching a four-week high, after Chinese authorities ordered production cuts across key northern steelmaking hubs to curb pollution during the annual sessions of the National People’s Congress. Under the so-called “blue skies” directive, mills were instructed to reduce blast furnace output by 30% for one week starting March 4, in an effort to limit emissions in Beijing during the high-profile political meetings. The tighter supply has lent short-term support to prices, as lower output typically bolsters profitability and margins for steel producers. Nonetheless, demand in top consumer China has remained subdued following the Lunar New Year holiday, and analysts expect steel consumption to soften in the first half of the year amid ongoing weakness in the property sector and cautious industrial activity.