China ferrous prices drop as steel hub Tangshan cautions mills on irregularities

05/13/2021 | 11:56pm

BEIJING, May 14 (Reuters) - Chinese ferrous futures extended losses on Friday, with steel prices plunging after top producer Tangshan city warned mills to maintain market order, while iron ore is set to give up a weekly gain.

The local government said it would look into illegal behaviours and suspend business at mills found manipulating market prices, spreading rumours or storing up goods to make a good bargain, as the growth in steel prices has outpaced the rise in costs. (https://bit.ly/33FXWV0)

The most-traded steel rebar on the Shanghai Futures Exchange , for October delivery, fell 6.0% to 5,640 yuan ($875.03) a tonne as of 0330 GMT.

Hot rolled coils, used in the manufacturing sector, declined 6.0% to 6,135 yuan per tonne.

The plunge in steel prices follows a drop in the prices of steelmaking ingredients.

Benchmark iron ore futures on the Dalian Commodity Exchange , for September delivery, dived as much as 9.4% to 1,149 yuan a tonne. The contract is on course for a 5.8% drop this week.

Spot prices of iron ore with 62% iron content for delivery to China <SH-CCN-IRNOR62>, compiled by SteelHome consultancy, had declined $12 to $220.5 a tonne on Thursday.

Dalian coking coal futures fell 5.9% to 1,904 yuan per tonne.

Coke futures on the Dalian bourse were down 6.5% to 2,613 yuan a tonne.

($1 = 6.4455 Chinese yuan) (Reporting by Min Zhang and Shivani Singh; Editing by Vinay Dwivedi)

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