BEIJING: Chinese metallurgical coal futures fell more than 3% on Thursday, as poor downstream demand impaired market sentiment while the government’s recent pledge on tighter supervision on coal prices is expected to curb any significant gains. “Domestic coking coal production has been mostly normal, but producers’ confidence weakened,” Huatai Futures said in a note, adding that spot coke prices resumed losses. Coking plants and steel mills are trying to control their coking coal stockpiles and purchasing on demand, according to the note.

China’s state planner recently pledged to punish price gouging as new coal price caps come into effect. The country’s central bank also said it had allocated 100 billion yuan worth of re-lending to support coal production and storage. The most-active coking coal futures on the Dalian Commodity Exchange for September delivery fell as much as 3.4% to 2,565 yuan per tonne, before edging down 2.8%, as of 0330 GMT.

Coke prices fell 2.2% to 3,329 yuan a tonne. Benchmark iron ore futures on the Dalian bourse stalled at 807 yuan per tonne. They were up 4% earlier during the session.

Steel prices on the Shanghai Futures Exchange were range-bound, with construction-used rebar for October delivery down 0.5% at 4,636 yuan a tonne. Hot-rolled coils declined 0.6% to 4,727 yuan a tonne and stainless steel futures inched 0.1% lower to 18,875 yuan per tonne.—Reuters