BEIJING: Ferrous futures in China declined on Tuesday, with Shanghai steel products down more than 3% in early trade tracking a drop in raw material prices, disrupted by domestic coronavirus situation and the coming restocking plan.

China reported 55 new COVID-19 cases for Jan.11. Hebei has stepped up restrictions to stop further infections, though it also hampered steel mills' outbound transportation.

Meanwhile, the winter restocking for steel products - normally weeks ahead of the Chinese New Year holidays - also disrupted steel prices.

"Considering off-peak season has arrived... market will not accept high profit margins for steel products," analysts with Huatai Futures wrote in a note.

Most active steel rebar contract on the Shanghai Futures Exchange, for May delivery, fell 2.5% to 4,296 yuan ($664.20) a tonne as of 0200 GMT.

Hot rolled coil, used in the manufacturing sector, slipped 2.6% to 4,429 yuan a tonne.

Both contracts fell more than 3% earlier in the session.

Stainless steel futures, for March delivery, dropped 3.3% to 13,735 yuan per tonne. It was down as much as 4.4% earlier in the session.

Prices for steelmaking ingredients also fell.

Benchmark iron ore futures on the Dalian Commodity Exchange were down 1.6% to 1,031 yuan a tonne.

Coking coal fell 2.8% to 1,728 yuan per tonne and coke down 3.9% to 2,756 yuan.

The plunge in coke prices came after market expectations that new coke capacity could be released in the first half of the year to ease supply shortages, said Huatai Futures.

Spot prices of iron ore with 62% iron content for delivery to China fell $1.5 to $171 per tonne on Monday, according to Steel Home consultancy.