BEIJING, May 12 (Reuters) - Futures for Chinese hot-rolled
coils hit a record high at 6,698 yuan ($1,040.03) a tonne on
Wednesday, while other ferrous products also extended gains,
causing analysts to alert market to risks amid the sky-rocketing
The most-traded October contract of hot rolled coils on the
Shanghai Futures Exchange surged as much as 3.8% to an
all-time high during the morning session. It was up 2.4% at
6,611 yuan a tonne as of 0330 GMT.
Construction steel rebar on the Shanghai bourse
inched 0.9% higher to 6,094 yuan per tonne.
The stainless steel futures for June delivery
jumped 2.1% to 15,560 yuan a tonne.
"Although it's still a bull market, the rapid price surge in
short-term has accumulated risks and there's possibility for
adjustment," analysts with SinoSteel Futures wrote in a note.
Despite a red-hot market for steel products in the past few
months, China's southern area is about to enter a rainy season
that could potentially dampen demand for construction materials.
Meanwhile, the country's top steel auto sheet producer
Baoshan Iron & Steel said in a call on Tuesday that
automobile demand in the second quarter is hurt by chip
shortage, while the third quarter is traditional off season,
according to a Citi Research note.
Prices for steelmaking ingredient also gained.
Benchmark iron ore futures on the Dalian Commodity Exchange
increased 0.4% to 1,306 yuan a tonne.
"The forward contract gained significantly stimulated by
intensified China and Australia relations," according to
SinoSteel, adding that the possibility of limiting iron ore
imports from Australia is very small, but sentiment could impact
in the short run.
Analysts with Huatai Futures also reminded investors to
control positions on increasing risks due to high iron ore
Dalian coking coal and coke futures rose
4.3% to 1,020 yuan and 0.8% to 2,872 yuan, respectively.
($1 = 6.4402 Chinese yuan renminbi)
(Reporting by Min Zhang and Shivani Singh;
Editing by Vinay Dwivedi)