Dalian coking coal futures climbed to their highest in nearly three months on Wednesday, as mining suspensions in China’s Shanxi province stoked worries about supply of the steelmaking ingredient.
The most-traded September coking coal on China’s Dalian Commodity Exchange rose as much as 3.2 percent to 1,488.50 yuan ($206.49) per metric ton during morning trade, its highest since April 25.
Shanxi LuAn Environmental Energy Dev Co said on Tuesday its mining unit has halted production from July 16 after an accident caused one death.
Two coal mines in Shanxi, China’s major coal mining hub, were ordered to suspend production on Tuesday for “rectification due to safety accidents,” according to Huatai Futures. It did not identify the mines.
“Many coal enterprises and regions carried out safety inspections, and some coal mines stopped production,” with the resumption of operations uncertain, Huatai analysts said in a note.
Prices of coke, the processed form of coking or metallurgical coal, also rose, with Dalian’s most-active September contract climbing 2.2 percent to its highest since April 24.
Iron ore prices fell, however, as traders assessed demand prospects amid a faltering economic recovery in top steel producer and metals consumer China, while waiting for Beijing’s policy measures to shore up activity. – Reuters
