Domestic futures opened higher, led by the black-series commodities, with rebar futures up more than 4%.
2016-12-12
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China Securities News reports that domestic futures opened higher today, with black‑steel commodities leading the gains. As of press time, the most active rebar contract was up 4.69%, the hot‑rolled coil contract rose 4.52%, and the iron ore contract advanced 4.80%. On the news front, over the weekend, steel billet prices in Tangshan surged by RMB 200 per ton for two consecutive days. Earlier, local authorities issued notices to crack down on illegal production of “strip steel,” which is expected to curb output from medium‑frequency induction furnaces. Industry sources indicate that the primary downstream products of these furnaces in Tangshan include rebar and ribbed wire rod. Analysts note that many short‑process steel mills in Tangshan rely on billets produced in medium‑frequency furnaces as feedstock; this round of inspections could therefore weigh on Tangshan’s rebar output and prices.
Among other commodities, most chemical products posted gains today, with the rubber main contract up 6.11%, the Zhengzhou ethanol main contract up 3.21%, and the plastic main contract up 3.81%. 
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