It is reported that because of rumors that Chinese commercial banks will tighten or even suspend loans to steel industry, steel futures at SHFE saw two day losing streak and the rebar futures fell more than 3%.
However most bands indicate although China Banking Regulatory Commission indeed has issued documents to call for the strengthening of credit verification of the steel industry, there is no stop loan notification and the granting of loans so far has not changed.
Affecting by the stop loan rumors, rebar futures collapse yesterday. Insiders said if the rumors are true, some traders' funding strand may break under current high inventories. And large number of shipments by traders will be a considerable downward pressure on steel prices.
Mr Wang Tieshan, analyst from Nanhua Futures, said before the appearance of rising reserve ratio and tightening capital by the central bank, steel futures prices is mainly supported by inflation expectations. So traders' strategy in futures market then was "to throw the spot and buy rebar far month". But "the results may not be very good because tightening expectation has replaced the expected inflation" said a trader.
However a number of commercial banks indicated that loans to steel industry have been unchanged so far and they have not received any stop loan documents. |
