China stainless steel futures soar

Benchmark nickel on the LME climbed for the first time since trade resumed last week and gained 15% on Wednesday. Shanghai nickel futures opened up 17% to hit the trading upper limit on Thursday.

“Stainless steel futures are again led by LME nickel prices and detached from the fundamentals in the short term,” Huatai Futures wrote in a note, adding that consumption of the metal was still held back by the COVID-19 situation.

The most-active stainless steel contract on the Shanghai

Futures Exchange, for April delivery, closed up 6.7% at 21,680 yuan ($3,405.00) a tonne. It rose to 22,345 yuan per tonne earlier during the session.

Other steel products on the Shanghai exchange were steady, with construction-used rebar, for May delivery, inching 0.4% higher to 4,945 yuan a tonne. Hot rolled coils rose 0.5% to close at 5,173 yuan per tonne.

Top steelmaking city Tangshan, also a major production hub for hot rolled steel products, is still under lockdown as local government struggles to contain infections after reporting dozens of locally transmitted COVID-19 cases.

Benchmark iron ore futures on the Dalian Commodity Exchange rose 1.3% to 818 yuan a tonne. Spot prices of 62% ironore were unchanged at $147 per tonne on Wednesday, data from SteelHome consultancy showed. Coking coal futures increased 2.7% to 2,998 yuan a tonne and coke prices added 3.1% to 3,618 yuan per tonne.