BEIJING: Stainless steel futures on the Shanghai Futures Exchange inched higher on Wednesday, fuelled by a pick-up in raw material prices and downstream consumption.

"Due to recent shutdown of some capacity in Inner Mongolia ... ferrochrome supplies dropped," GF Futures wrote in a note, explaining the price surge in the raw material used to manufacture stainless steel.

Downstream demand also recovered on increasing export orders, GF Futures added.

The most-traded stainless steel futures contract, for March delivery, was up 0.8% at 13,845 yuan ($2,145.75) a tonne by 0215 GMT, the only gainer across the ferrous market in early trade.

Other steel futures extended losses, with steel rebar , for May delivery, dropping 0.6% to 4,277 yuan a tonne.

Hot-rolled coil edged down 0.5% to 4,409 yuan per tonne.

FUNDAMENTALS

Iron ore futures on the Dalian Commodity Exchange slipped 0.6% to 1,028 yuan a tonne.

Spot prices of iron ore with 62% iron content for delivery to China rose by $0.5 to $171.5 per tonne on Tuesday, according to SteelHome consultancy.

Dalian coking coal plunged 2.9% to 1,6941 yuan a tonne.

Coke declined 1.3% to 2,737 yuan a tonne.

German gas transmission system operator OGE, steel producer Thyssenkrupp and Norwegian energy company Equinor on Tuesday said they would deepen cooperation to help cut carbon emissions from a Thyssenkrupp plant in Duisburg, Germany.