BROWSE

UPDATE 1-Dalian iron ore, coke futures drop on prospects of more Tangshan output cuts | Reuters

Chinese iron ore and coke futures on the Dalian Commodity Exchange slumped on Friday as traders fretted over prospects of further production cuts in the top steelmaking city of Tangshan.

A notice issued by Tangshan government circulating in the steel industry on Friday showed output curbs could last throughout this year, with production at most local mills to be reduced from 30-50%.

Prices for steelmaking raw materials fell on demand concerns as Tangshan accounted for nearly 14% of China’s total crude steel output.

Benchmark iron ore futures, for May delivery, closed down 3.5% to 1,042 yuan ($160.16) per tonne on Friday, sending their weekly loss to 2.8%.

Coke prices on the Dalian bourse dived as much as 4.4% to 2,231 yuan a tonne. The contract closed down 3.5% to 2,253 yuan.

Dalian coking coal futures, another steelmaking ingredient, narrowed gains to 0.8% at close from a 3.3% jump earlier during the session.

According to Mysteel consultancy, capacity utilisation rates at 247 blast furnaces across China fell to 87.16% as of Mar.19 from 90.39% a week earlier after some production restrictions in Tangshan earlier this week.

Steel futures on the Shanghai Futures Exchange were traded within tight range on Friday but increased for the week.

Construction rebar ended down 0.7% to 4,746 yuan. It rose 0.4% for the week.

Hot-rolled coil, used in cars and home appliances, rose 0.7% to 5,026 yuan a tonne. Its weekly gain stood at 0.6%.

Shanghai stainless steel futures dipped 0.1% to 13,965 yuan per tonne at close. FUNDAMENTALS

* China’s steelmakers foresee a strong second quarter on continued high demand and expect raw material prices to fall from recent peaks, the country’s steel association said.

* Rio Tinto Ltd would endorse resolutions to set targets for cutting carbon emissions and take tougher measures against lobby groups that do not follow its climate change goals ahead of shareholder meetings next month. ($1 = 6.5059 Chinese yuan) (Reporting by Min Zhang and Dominique Patton, Editing by Sherry Jacob-Phillips)

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