Steel pipes are seen stacked at an industrial park in Shenyang, Liaoning province, China September 30, 2021. REUTERS/Tingshu Wang
BEIJING/MANILA, Nov 1 (Reuters) – Prices for steelmaking ingredients on the Dalian Commodity Exchange slipped on Monday due to sluggish demand at mills stemming from locally mandated output cuts, while Beijing’s coal price controls also weighed on sentiment.
Steel, cement and coking plants in the steel hub of Tangshan city were recently ordered to cut production following a heavy-pollution alert, according to the local government.
Stocks of imported iron ore at China’s ports gained by 2.1 million tonnes to 142.3 million tonnes last week on weakening demand, data from SteelHome consultancy showed.
Benchmark iron ore futures on the Dalian bourse , for January delivery, fell 3.4% to 634 yuan ($99.00) per tonne as of 0231 GMT.
Other steelmaking raw materials also declined after the state planner said the coal supply situation had improved significantly, and it would launch an online platform in early November to monitor the implementation of long-term coal contracts. read more
Dalian coking coal plunged 5.4% to 2,249 yuan a tonne and coke futures dropped 3% to 3,015 yuan per tonne.
“Recently, affected by the government’s stringent control of coal prices, costs plunged and sent down steel prices,” analysts with Haitong Futures wrote in a note.
“In the short term, the impact from raw materials could be stronger than fundamentals.”
Construction-use steel rebar on the Shanghai Futures Exchange fell 2% to 4,597 yuan a tonne.
Hot rolled coils futures , used in the manufacturing sector, slipped 2.4% to 4,916 yuan per tonne.
Stainless steel futures on the Shanghai exchange , for December delivery, fell 1.6% to 18,925 yuan a tonne.
($1 = 6.4040 Chinese yuan renminbi)
Reporting by Min Zhang in Beijing and Enrico Dela Cruz in Manila; Editing by Ramakrishnan M.
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