Production cuts likely to keep steel mills cautious on raw materials

Steel mills in Liangyungang and Changzhou in Jiangsu province are likely to turn cautious in purchasing raw materials given the required production cuts on environmental concerns.IRON ORE

To maintain air quality for the Shanghai Cooperation Organisation (SCO) Summit in Qingdao next month, three steel mills in Lianyungang have cut production by 30% from May 30 to June 12. The mills are Binxin Steel, Yaxin Steel and Xingxin Steel.

Some steel mills in Changzhou also have received a notice of production cuts as the government intensifies its efforts in controlling air pollution across the region from May 28 to June 30.

The most traded contract on the Dalian Commodity Exchange traded rangebound with a wide range on Wednesday May 30 and closed at 455.5 yuan/mt, down 0.87%. In the spot market, traders made firm offers. Pilbara Blend fines traded at 455 yuan/mt in Shandong area.

MMi Iron Ore Port Index went up 7 yuan/wmt at 472 yuan/wmt fot Qingdao on Wednesday May 30 for 62% Fe fines.

The index for 58% Fe fines also gained 3 yuan/wmt to 322 yuan/wmt while the index for 65% Fe fines edged up 7 yuan/wmt to 567 yuan/wmt.

Source: SMM