Steel and iron ore futures in China rose for the second day in a row on Tuesday, with the market rebounding after last week's rout, but the outlook remains uncertain with underlying demand still weak.
The China Iron and Steel Association (CISA) warned in its regular outlook report on Tuesday that the market was likely to remain volatile in the weeks to come.
Rebar used in construction on the Shanghai Futures Exchange ended Tuesday up 2.97 percent at 2,114 yuan ($324) per tonne. The most-traded iron ore contract on the Dalian Commodity Exchange closed at 385.5 yuan a tonne, up 4.9 percent.
Rebar futures prices suffered their biggest weekly drop since 2009 last week, shedding 12 percent, amid concerns that a rapid increase in production by Chinese steel mills has not been matched by any corresponding improvement in demand.
China's average daily crude steel output reached a record 2.314 million tonnes in April, up 1.5 percent compared to the previous month, raising concerns that mills were ignoring the long-term health of the sector in pursuit of quick profit.
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