Chinese steelmaking raw materials futures advanced on Thursday, with coking coal up 5%, fuelled by hopes of recovering steel production after stringent curbs in the first 11 months of the year.
The world's top steel producer churned out 946.36 million tonnes of the metal during January to November, down 2.6% from the same period last year, in an accelerating decline driven by strict output curtailment.
Huatai Futures wrote in a note that since targets for crude steel output have now been met, some mills are resuming production and profitability is relatively good.
A government consultancy on Wednesday predicted that China's steel demand could dip in 2022 from this year, but consumption from infrastructure construction, automobile and other sectors will continue to offer support.
Benchmark iron ore futures on the Dalian Commodity Exchange , for May delivery, ended up 2.8% to 673 yuan ($105.71) per tonne.
Spot prices of iron ore with 62% iron content for delivery to China , compiled by SteelHome consultancy, was unchanged at $115.5 per tonne on Wednesday.
Dalian coking coal futures surged as much as 5% to 2,143 yuan a tonne and were up 4.8% to 2,2140 yuan at close.
Coke prices on the Dalian bourse were up 1.8% at 3,053 yuan a tonne.
Steel prices on the Shanghai Futures Exchange also gained. Construction used rebar increased 2.4% to 4,529 yuan a tonne and hot rolled coils, used in the manufacturing sector, were up 2.7% at 4,719 yuan per tonne.
Shanghai stainless steel futures, for February delivery, inched 0.1% higher to 16,115 yuan a tonne.
Source: Reuters
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