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Shanghai stainless steel rebounds as nickel prices surge, other ferrous metals tumble

Shanghai stainless steel rebounds as nickel prices surge, other ferrous metals tumble

FILE PHOTO: Steel pipes are seen stacked at an industrial park in Shenyang, Liaoning province, China September 30, 2021. REUTERS/Tingshu Wang

:Chinese stainless steel futures snapped a three-session losing streak on Thursday, buoyed by a surge in steelmaking ingredient nickel prices, although analysts warn that downstream consumption of the metal remains sluggish.

Nickel prices on the Shanghai Futures Exchange jumped as much as 8per cent to a record 161,600 yuan (US$25,283.58) per tonne.

China's imports of nickel ore and nickel pig iron fell 1.6per cent and 12.3per cent, respectively, on a monthly basis in September, data released by the customs office on Wednesday showed.

Stainless steel futures on the Shanghai bourse, for November delivery, ended up 1.1per cent at 20,470 yuan per tonne. Earlier in the session, they had risen 5.1per cent to 21,280 yuan.

However, analysts say stainless steel consumption is still slow in the short term as recent power rationing has hurt manufacturing activities in the world's second-largest economy.

Other ferrous metal prices in China plunged in afternoon trading, with coking coal, coke and construction rebar all dived to daily trading limits on falling coal prices and stagnant steel consumption.

The securities regulator said late on Wednesday that it would ask futures exchanges to take multiple measures, including raising fees and restricting trading limits, in response to high coal prices.

Coking coal futures on the Dalian Commodity Exchange slumped 12per cent to 3,109 yuan a tonne, while coke was also down 12per cent at 3,664 yuan a tonne.

They have dropped 19.2per cent and 17.5per cent, respectively, from record highs logged earlier this week.

Benchmark iron ore futures on the Dalian bourse plummeted 8.7per cent to 651 yuan per tonne.

Steel rebar on the Shanghai exchange dropped 8per cent to 4,976 yuan a tone. Hot rolled coils declined 6.2per cent to 5,268 yuan per tonne.

Apparent consumption of five main steel products in China, including rebar and hot rolled coils, fell 7.5per cent to 9.26 million tonnes as of Thursday from a week earlier, data from Mysteel consultancy showed.

(US$1 = 6.3915 Chinese yuan)

(Reporting by Min Zhang in Beijing and Tom Daly; Editing by Subhranshu Sahu)

Source: Reuters

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