A man works on transporting iron ore on a truck at Ganyu port in Lianyungang, Jiangsu province, China June 11, 2019. Picture taken June 11, 2019. REUTERS/Stringer/Files
Chinese steel and iron ore futures rose on Friday, while coking coal and coke both gained nearly 5% against a backdrop of strong demand at mills and supply tightness.
The most-traded coke futures on the Dalian Commodity Exchange , for September delivery, jumped 1.1% to 2,827 yuan ($438.21) per tonne at close. They rose 5% for the week.
Coking coal futures on the Dalian bourse inched 0.2% lower to 2,045 yuan a tonne, but logged a 4.6% gain this week.
Inventories of coking coal held by 100 coking plants and 110 steel mills, surveyed by consultancy Mysteel, fell 3.2% to 15.7 million tonnes as of Thursday, from a week earlier due to a supply crunch amid environmental and safety production inspections.
Benchmark iron ore futures increased 1.2% to 1,185 yuan per tonne. Spot prices for 62% iron ore fell $2 to $217 a tonne on Thursday, according to consultancy SteelHome.
“Iron ore and steel prices are once again rising higher … amid strong demand from the Chinese steel industry and supply issues from the largest global producers,” Fitch Solutions wrote in a note.
However, an improvement in supply and weaker consumption by downstream players at current high prices are expected to cap gains in the coming months, Fitch Solutions added.
Construction steel rebar on the Shanghai Futures Exchange , for October delivery, rose 1.8% to 5,066 yuan per tonne.
Hot rolled coils , used in the manufacturing sector, increased 1.8% to 5,288 yuan a tonne.
The August contract for Shanghai stainless steel futures rose 1.8% to 16,750 yuan per tonne.
The world’s top steel producer China Baowu Steel Group said late on Thursday its stainless steel unit TISCO Group has teamed up with Brazilian miner Vale and Shandong Xinhai Technology to make nickel pig iron in Indonesia.