There will also be a "construction boom" in urban metro lines, renewable energy and water projects this year, the China Iron and Steel Association said today on its website. Steel futures in Shanghai jumped to a record.
Spot-steel prices have increased every day of this year, reaching 4,847 yuan ($736) today, the highest since Sept. 26, 2008, on rising iron ore costs and demand from construction companies. China aims to build 10 million homes this year as part of the social housing program, up 72 percent from a year earlier, according to the association.
"Prices are expected to trend higher as demand recovers after the Lunar New Year holiday," which starts Feb. 2 and ends Feb. 8, the group said. "Demand will be strong in general."
China plans to invest 700 billion yuan this year for the construction of railways, the official Xinhua News Agency said Jan. 4, citing Railways Minister Liu Zhijun. That paces the investment amount in 2010, according to Xinhua.
The prices of 62 percent-iron ore arriving at Tianjin port rose to $185.70 a ton on Jan. 21, the highest level since April 21, according to the Steel Index, a data provider.
China's crude steel output rose 2.6 percent to 51.5 million tons in December from 50.2 million tons a month ago, as mills ramp up production on restored power supplies and higher prices.
Steel inventories held by local traders rose 1.4 percent, the first gain in seven months, to 13.24 million tons at the end of December from a month ago, the group said. It was 7.4 percent higher than a year earlier, the association said.
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