- Americans warned to prepare for coronavirus outbreak
- Emergency response measures lowered in parts of China
- China steel group sees industry rebound in Q2 - report
Steel futures in China teetered in morning trade on Wednesday as worries that the fast-spreading coronavirus outbreak could turn into a global pandemic countered expectation of a demand pick-up in the second quarter.
The Shanghai Futures Exchange's most-traded construction steel rebar contract SRBcv1 was up 0.1% at 3,466 yuan ($494.24) a tonne by the midday break. Hot-rolled steel coil SHHCcv1 , used in cars and home appliances, was virtually flat.
Fears have mounted that the worsening health crisis, which has already disrupted businesses, may cripple global steel trade, in a major blow to China that accounts for about half of the global steel output.
Authorities around the world have stepped up measures to prevent the spread of coronavirus that has killed more than 2,700 people and infected about 80,000, mostly in China, with the death toll and new cases outside Asia now rising as well.
In the United States, the immediate risk was still low but a health expert warned that the current global situation suggested a pandemic was likely.
"As the possibility of an outbreak in the United States gradually increases, the panic in the market has further spread," Huatai Futures Co Ltd analysts wrote in a note.
Helping calm nerves, many parts of China have now eased travel curbs while hundreds of thousands of migrant workers have returned to work in main manufacturing hubs in the country's east and south.
Despite wobbly trading, China's steel futures were on course for a third straight weekly gain amid hopes of a quick rebound for an industry that is under pressure from rising inventories, weak downstream demand and falling spot prices.
"A vigorous revival of market demand in the second quarter of this year is expected, given that Chinese authorities have rolled out a slew of measures to stabilise economic growth," the China Daily newspaper on Tuesday quoted Luo Tiejun, vice-chairman of the China Iron and Steel Industry Association, as saying.
Stainless steel SHSScv1 , however, slumped 1.3%, extending losses amid record-high stockpiles in China.
FUNDAMENTALS
- On the Dalian Commodity Exchange, the most-active iron ore contract DCIOcv1 slipped 0.8%, extending its correction into a second day after a 10-session rally. Futures on the Singapore Exchange shed 0.9%.
- Benchmark 62% iron ore's spot price settled at $91.50 a tonne on Tuesday, after scaling its highest in nearly five weeks at $93 on Monday, SteelHome consultancy data showed. SH-CCN-IRNOR62
($1 = 7.0128 yuan)
