<article><p class="lead">Singapore's construction industry remains crippled by Covid-19-related restrictions and is operating only at 50-60pc capacity, reducing the city-state's steel demand and keeping spot rebar buyers on the market sidelines until at least late 2020. </p><p>The southeast Asian nation reported 57,576 Covid-19 cases through 20 September, with most of the infections involving foreign workers living in dormitories. Quarantine measures to control the spread of the virus shuttered construction sites in the city-state from April-July. This led to a fall in import bookings, as well as rebar consumption by around 130,000-140,000 t/month. </p><p>"Construction activity stopped for four months and our import bookings decreased by [a total of] at least 400,000t during this period," a Singapore consumer said. The city-state's rebar demand usually reaches around 1.6mn-1.7mn t/yr, he said. </p><p>Singapore's construction industry showed signs of recovery in August after the government eased quarantine requirements for workers. Construction sites will now be shut for one to two days instead of 14 days if new cases are discovered. But recovery remains slow because of a fear of a resurgence of infections, making it difficult for local operators to continue business and pushing some small firms to the brink of closing because of dwindling funds, domestic market participants said. </p><p>The construction sector's contribution to Singapore's gross domestic product fell by 58.7pc from the first quarter to S$1.92bn ($1.4bn) in the second quarter. </p><p>Singapore's Building and Construction Authority (BCA) last week lowered its projected construction demand for this year to S$18bn-23bn, down from its January forecast of S$28bn-33bn. </p><p>Some public-sector projects have been postponed from this year to 2021, the BCA said. Construction demand is expected to recover to some extent from 2021, supported by residential developments and upgrades, new healthcare facilities and construction of the Cross Island train line, it said. </p><p>By contrast, Asean rebar prices have been on an upward trend since the second quarter of this year, supported by restocking demand from Hong Kong and rising export prices from major steel-exporting countries.</p><p>The <i>Argus</i> Asean rebar index rose by 17.5pc, or $70/t, to $469/t cfr Singapore as of 18 September from a 2020 low of $399/t in early May. </p><p>Hong Kong buyers have been restocking since April, with deal prices rising from $410/t cfr actual weight in early April to $480/t cfr actual weight in late August. <i>Argus</i> assessed Turkish export rebar prices at $453/t fob actual weight as of 21 September, up by $50/t from late March. </p><p>"I am afraid that rebar import bookings from Singapore will not emerge before November as many consumers are still working through their inventories. Some small companies have enough inventories for eight to nine months of consumption," a leading consumer in Singapore said. "The hardest time has passed, with everything slowly getting back on track. Some traders are considering booking December shipments to prepare for a full-scale recovery next year." </p></article>
