Iron ore eked out small gains, breaking a nine-day losing streak that had knocked prices to a one-month low on Monday. Steel rebar, used in construction, was flat to slightly higher.
Concerns about economic growth in the world’s top commodities market and efforts by the government to rein in its red-hot property market continued to weigh on sentiment.
Adding to fears about broader declining consumption, steel mills typically curb their output during the quieter winter months and ahead of the Chinese Lunar New Year holiday at the end of January.
“Coke spot prices tumbled sharply today on decreasing purchases from steel mills,” said Zhang Min, coal analyst at China Sublime Information Group.
“A big fall on the spot market has triggered more selling of coke futures today, led by institutional investors who are holding large positions.”
The most-active coking coal futures on the Dalian Commodity Exchange were down 2.7 percent at 1,169.50 yuan ($168.28) per tonne, after falling to as low as 1,143 earlier in the session, its lowest since Oct. 18.
Coke fell 3.07 percent to 1,530.50 yuan ($220.23) per tonne. Earlier in the session, coke was as low as 1,495 per tonne, its lowest since Nov. 3.
Steel plants in Tangshan, in Hebei province, which accounts for about one-fifth of China’s steel output, are operating at around 70 percent to 74 percent of capacity, down from 80 percent in October, Zhang said, citing Sublime Group data.
Iron ore on the Dalian Commodity Exchange was up 0.92 percent at 550.50 yuan ($79.21) a tonne, while the most-active rebar contract for May delivery on the Shanghai Futures Exchange rose 0.03 percent to 2,928 yuan ($421.31) per tonne.
Source: Reuters (Editing by Christian Schmollinger)