Chinese steel and iron ore prices are up during the early trade on Monday after rebar increased for the first time in five consecutive sessions due to the increase in restocking demand and the high hopes that the United States and China agree on a deal before the March 1 deadline.
On the Shanghai Futures Exchange, the most active construction steel rebar increased by 0.1 percent at 3,639 yuan per tonne at 0215 GMT. The price of hot-rolled coiled gained by 0.6 percent reaching 3,590 yuan.
Richard Lu, an analyst at CRU in Beijing, there should be some steel traders and users usually do this restocking either before or after the holidays, the Lunar New Year which was celebrated in China earlier this month. He, however, said that the extent that restocking will support the demand has no certainty.
He added that a lot of participants in the market are still away and some people are taking additional holidays which means that the market, in general, is still quiet compared with the normal level. He also said that the high hopes for the United States-China trade talks also backs the current strength of steel.
On Saturday, reports circulated in China expressing the optimism over the trade talks between the two economic giants. The reports circulated a day after Chinese President Xi Jinping announced that the one-week discussions between Chinese trade delegates and their American counterparts had produced a "step-by-step" process.
On Saturday, United States President Donald Trump was updated on the talks and he tweeted that the results were "very productive".
The White House confirmed that a new round of talks between the trade representatives of the two nations is set on Tuesday in Washington. Follow-up sessions are also expected at a higher level during the week.
The White House's statement said that the talks are aimed at achieving needed structural changes in China that affect trade between the United States and China. The statement also said that the two sides will discuss China's pledge to purchase a substantial amount of goods and services from the United States.
On the Dalian Commodity Exchange, the most traded iron ore increased by 0.2 percent at 626.5 yuan following its increase of about 2.6 percent during the early trade.
There is a decrease in the price of coking coal by 1.2 percent for 1,257 yuan per tonne. Coke dropped by 0.5 percent at 2.05 yuan. The price of Spot iron ore scheduled to be delivered to China remained at $87.80 per tonne on Friday.
