BEIJING: Chinese coking coal and coke futures fell to a one-month low on Thursday and iron ore prices tumbled more than 3.5% as steel production cuts at some mills sparked concerns about demand for the steelmaking ingredients.
A major steel producer in eastern China had been urged to idle its blast furnaces after a central government inspection, according to Zhuo Guiqiu, an analyst with Jinrui Capital, who declined to name the producer.
China had pledged to control its annual crude steel output at lower level than last year. The country's state planner said earlier this year that it would conduct field inspections in June-July.
There are increasing worries that demand for raw materials such as coke would further weaken as more places are said to have stepped up steel output controls, Zhuo added.
The most-traded coke futures on the Dalian Commodity Exchange, for September delivery, dropped as much as 4.9% to 2,483 yuan ($383.26) yuan per tonne, the lowest since June 8.
Coking coal futures declined 4.5% to 1,846 yuan per tonne as of 0322 GMT. They plunged as much as 5.1% earlier.
Benchmark iron ore futures on the Dalian bourse dropped 2.7% to 1,191 yuan a tonne, after falling as much as 3.6%.
Steel prices on the Shanghai Futures Exchange gained.
Construction-used steel rebar, for October delivery, rose 1.1% to 5,400 yuan per tonne. Hot rolled coils jumped 2% to 5,780 yuan a tonne. Shanghai stainless steel, for August delivery, increased 2.4% to 17,100 yuan per tonne.
China's cabinet said on Wednesday that it would timely adopt monetary policies such as cutting the bank reserve requirement ratio to support the real economy against rising commodity prices.
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