Steel reinforcing bar, or rebar, is reportedly retaining its value in the Chinese futures market. That is occurring despite a global commodities market that has seen most materials plunge in value with the global spread of the COVID-19 coronavirus.

Rebar, made in most parts of the world with ferrous scrap as a significant percentage of its feedstock, is used in road building and other construction applications.

According to a March 17 Bloomberg report, investors in China are turning to rebar as a safe haven investment, as they anticipate governments in China and elsewhere will pour money into infrastructure to stimulate their economies.

In China, rebar has for several years been actively traded on the Shanghai Futures Exchange (SHFE), often attracting attention from traders and speculators who don’t have any physical holdings of steel. Instead, they see the material as a wager or hedge pegged to infrastructure investment and the construction sector overall.

Bloomberg reports that the price of rebar on the SHFE has risen by almost 5 percent from mid-February to mid-March. “Over the same period, gold — the traditional [safe] haven amid turmoil — has dropped more than 5 percent, as investors sell to cover losses in other markets,” writes Bloomberg News.

Steel pricing overall (and the iron ore and ferrous scrap used to produce it) has held firmer compared to the fates of aluminum or copper on terminal markets, the same report notes. As with rebar, that may be because the ferrous sector is “drawing strength from its proxy status as a China macro signal,” according to a Singapore-based commodities trader quoted by Bloomberg.

The same trader says rebar speculation ties into people placing a wager on governments and economies “winning [a] war in containing the spread of the virus [and] possible policy stimulus by Beijing to kick-start growth.”

On the London Metal Exchange (LME), where rebar also trades, the material has traded in a narrow price range from mid-February to mid-March. Rebar was trading at $430 per metric ton from March 2 to March 12, but declined slightly the next few days, reaching $427 on March 17.

That contrasts significantly with copper, which has dropped from $5,800 per metric ton ($2.63 per pound) on Feb. 17 to $5,203 per metric ton ($2.36 per pound) on March 17. In 30 days, the value of copper dropped by 10.3 percent on the LME, while rebar lost just 0.7 percent of its value in London.