One of China’s top steel producers, the northern city’s government said it would launch a level 2 emergency response from Sunday to deal with the forecast heavy air pollution this week.
Several mills planned to reduce their sintering capacity between 30% and 50% to meet the government requirements, consultancy Mysteel said in a report.
It was not clear how long the production restrictions would last. The city of Handan, also a key steel producer, implemented similar curbs from Sunday.
The most-traded May iron ore futures contract on the Dalian Commodity Exchange (DCE) traded 0.55% lower at 903.50 yuan ($129.80) a tonne as of 0152 GMT. On the Singapore Exchange, the benchmark March iron ore contract traded at $125.55 a tonne, down 0.95%.
“It’s mainly the production restrictions [in Tangshan and Handan]that drove futures prices down this morning,” said a Shanghai-based steel analyst who declined to be identified because they are not authorised to speak to media.
