BEIJING, March 4 (Reuters) - Stainless steel futures in China dropped 6% on Thursday to hit their daily trading limit, as a slide in nickel rates weighed on prices.

Nickel prices on the Shanghai Futures Exchange also declined 6% on supply glut concerns after Tsingshan claimed stable supply for nickel matte.

"Stainless steel prices are dented by sentiment of the nickel market," analysts with Huatai Futures said in a note. "But, the nickel matte news can benefit stainless steel in the mid term."

The most-traded stainless steel contract on the Shanghai bourse, for May delivery, fell to 13,990 yuan ($2,163.09) per tonne.

However, analysts at Huatai Futures said supply and demand for stainless steel in the first half of 2021 were not weak and prices could rebound after the sentiment-driven disruption.

Other steel futures on the Shanghai exchange were range-bound.

Steel rebar inched up 0.1% to 4,849 yuan per tonne, while hot rolled coil dipped 0.04% to 5,016 yuan.

Demand for steel products in China jumped 24.9% to 9.28 million tonnes as of Thursday from a week earlier, the highest since the week ended Jan. 21, according to Mysteel consultancy.

FUNDAMENTALS

* Benchmark iron ore futures on the Dalian Commodity Exchange rose 2% to 1,175 yuan a tonne.

* Spot prices of iron ore with 62% iron content for delivery to China gained by $2 to $176.5 per tonne on Wednesday, data from SteelHome showed.

* Dalian coking coal ended up 0.2% at 1,503 yuan a tonne.

* Coke futures dropped 1.8% to 2,487 yuan per tonne.

* China's coal consumption is expected to continue rising in 2021 despite Beijing's pledges to boost the use of clean energy and curb greenhouse gas emissions, the China National Coal Association said on Wednesday. ($1 = 6.4676 Chinese yuan) (Reporting by Min Zhang and Shivani Singh; editing by Uttaresh.V and Subhranshu Sahu)