COKING coal and coke futures on the Dalian Commodity Exchange plunged yesterday, as some mills attempt to lower purchase prices of the steelmaking ingredients due to tight steel profit margins in China.

“The uneven profit distribution is the main drive for steel producers to crack down coke prices,” Sinosteel wrote in a note, adding that profit at sample coking plants were at a record high last week while raw material costs for blast furnaces continue to climb.

The most actively traded coking coal futures, for May delivery, slumped nearly 6 percent to 1,487 yuan (US$230.07) per ton and closed down 4.8 percent.

Coke futures were down as much as 4.7 percent, the biggest daily percentage loss since Jan. 12. It ended 4 percent lower at 2,617 yuan per ton.

Benchmark iron ore futures on the Dalian bourse, meanwhile, jumped on hopes of post-holiday demand. They were up 1.17 percent at 1,139 yuan per ton in morning trading.

Capacity utilization rates at 247 blast furnaces across China rose to 92.19 percent as of Feb.19, from 90.94 percent before the seven-day Lunar New Year holiday, according to Mysteel consultancy.

Prices for spot iron ore with 62 percent iron content for delivery to China stood at US$173 per ton Friday.

Steel prices on the Shanghai Futures Exchange advanced. Most-traded construction rebar gained 1.1 percent to 4,582 yuan a ton.

Hot-rolled coil, used in the manufacturing sector, jumped 2.7 percent to 4,822 yuan per ton. Stainless steel futures, for April delivery, surged 1.2 percent to 15,280 yuan a ton. (SD-Agencies)