BEIJING (Reuters) – Chinese stainless steel futures extended gains for the third straight session on Thursday, rising as much as 3% on expectations of lower production, even as demand was hampered by lower seasonal consumption.
Steelmakers are expected to strengthen maintenance amid the weak demand outlook and metal production will remain at relatively low levels until the Chinese New Year holidays, Jinrui Futures wrote in a note, adding stainless steel prices will be supported by costs of raw materials.
The most traded stainless steel contract on the Shanghai Futures Exchange for February delivery rose as much as 3% to RMB 16,635 ($2,611.26) a tonne. At closing, the increase was 2.9% to 16,625 yuan per ton.
Shanghai stock exchange steel rebar futures for May delivery advanced 0.6% to RMB 4,479 per tonne.
Hot-rolled coils, used in cars and appliances, rose 0.04% to 4,584 yuan per ton.
Prices of raw materials for steel production on the Dalian exchange were mixed.
Benchmark iron ore futures fell 0.7% to RMB 693 a ton, following the spot market as 62% iron ore prices for delivery to China fell by $1.5 to $127.5 a ton on Wednesday, according to consultancy SteelHome.
Dalian coking coal prices finished up 1.2 percent to RMB 2,250 a tonne, and coke futures rose 0.6% to RMB 3,088 a tonne.
(Reporting by Min Zhang in Beijing and Enrico Dela Cruz in Manila)
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