BEIJING- Steel futures prices extended gains on Tuesday, underpinned by the lingering production restrictions in China’s top steelmaking hub-Tangshan.
The municipal government of north China’s Tangshan asked the 11 A-class steel mills to take initiative to cut production, while mills rated as B-class and below need to suspend 50 percent of their sintering equipment over July 1-31, analysts at consultancy Mysteel said in a note on Monday.
Local mills have cut their sintering production between 30 percent and 50 percent, and the current sintered ore stocks could sustain normal production for around 8-20 days, Mysteel analysts said on Tuesday, adding that operations of blast furnaces are unaffected for the moment.
Helping the steel market is also the expectation of reduced supply after a few Chinese steelmakers announced plans on blast furnace maintenance in July.
Steel benchmarks on the Shanghai Futures Exchange posted broad gains in the morning trading session.
