China iron ore futures hit lowest in March so far on steel curbs
MANILA, March 11 (Reuters) - Steelmaking raw materials fell in China on Monday, with the benchmark iron ore contract hitting its lowest for this month so far and coke extending its losses into a fifth session, as demand waned amid restrictions on steel production.
The drop in futures mirrored weakness that has prevailed in the physical market since last week, a Shanghai-based trader said.
“The air pollution situation in many areas in China is not that good. I believe there will be another round of restrictions on production for the steel industry,” the trader said.
Officials in 28 northern Chinese cities, including in the top steelmaking city of Tangshan, face central government evaluations at the end of March on their performance in curbing air pollution over the past winter.
The most-traded iron ore contract on the Dalian Commodity Exchange, with May expiry, fell as much as 3.5 percent to 595 yuan ($88.53) a tonne, the lowest since Feb. 27.
Other raw materials for steel production fell as well, with Dalian coke dropping as much as 3.0 percent to 1,982.5 yuan. Coking coal slid 2.5 percent to 1,223 yuan.
Tangshan has indefinitely extended the highest level of smog alert, in place since March 1, forcing mills to cut output by 40 percent to 70 percent or even stop production.
