An Empirical Analysis Of Factors Affecting Rebar Futures Prices

Steel futures is not an unfamiliar word in China. In the early1990s, China launchedthe steel futures. However, due to market imperfections and excessive speculation, it waseventually suspended by the State Council. After over ten years of continuous adjustment,in the March27,2009, the Shanghai Futures Exchange launched the Rebar futures. As animportant product of steel, rebar is widely used in various fields of economy. The re-launchof steel futures after the world economic crisis provides hedging tools for steel companies,helps the steel industry to manage the price risks. In this paper, some important factors thataffect the steel futures prices are analyzed, their relationships with steel futures prices arecompared, and eventually the factor affects the price mostly is found through an empiricalmodel. The price factors analysis could help steel companies to forecast the steel futuresprice trend by using different factors, then to hedge the risks, to lock production costs.