Dalian coke rises on supply concerns

The Dalian price of steelmaking raw ingredient coke rose on Wednesday, on track for its strongest day in nearly two weeks, as investors worry about tight supply amid anti-pollution measures in northwestern China.

Linfen city in coal-mining hub of North China's Shanxi Province may enforce production restrictions for heavy industry, including coke, steel, coal-fired power, casting, chemicals and building materials sectors, from mid-November until mid-March next year, the State-backed China Environment News reported.

Industrial plants that fail to meet certain emission standards will be ordered to halve their production or even shut down.

Linfen's policy would reduce daily coke output by around 5,200 tons, said analysts from Huatai futures in a note.

The most-active coke futures on the Dalian Commodity Exchange rose 1.5 percent to 2,407.5 yuan ($347.08) a ton as of Wednesday morning, on course for their best performance since October 12.

Some coke producers hiked physical prices by 50-100 yuan a ton in northern China this week, which has also helped to drive up futures prices.

Dalian coking coal edged up 0.1 percent to 1,382 yuan a ton, after a coal mining accident in eastern Shandong Province on Monday that killed three people and led to the temporary closure of 41 mines.

The benchmark steel rebar contract on the Shanghai Futures Exchange had little change at 4,162 yuan. Trading volumes in the previous session fell to a two-week low, as investors take a cautious stance ahead of more information about winter production curbs across the country.

China allowed local governments to set their own winter production restrictions this year, ditching last year's blanket limits.

East China's Anhui Province in the manufacturing hub Yangtze River Delta said that it would introduce anti-smog measures during the winter season as part of efforts to improve air quality, but did not give details for individual producers.