<p>China's stainless steel futures extended gains on Thursday, leaping as much as 5%, as higher cost of feedstock nickel and tight supply drove prices higher for the metal used in vehicles and cookware.</p>.<p>The most-active March stainless steel contract on the Shanghai Futures Exchange rose to the day's upside limit of 14,725 yuan ($2,280.72) a tonne, the highest since late October.</p>.<p>The smelting cost of nickel pig iron, the feedstock for stainless steel, remains high because many Chinese smelters are using high-priced nickel concentrate bought recently, according to a Mysteel consultancy report citing a market source.</p>.<p>Prices of nickel continued to rise, with the London Metal Exchange benchmark crossing the $18,000 a tonne level for the first time since September 2019, as extended riots in key producer New Caledonia fuelled supply worries.</p>.<p>Shrinking nickel inventories in warehouses monitored by the Shanghai exchange, which fell by more than half in 2020, have also added pressure on prices.</p>.<p>"The domestic spot premium continues to strengthen, and there is still support under the nickel price," Huatai Futures analysts said in a note.</p>.<p>"The stainless steel futures price may remain strong for the time being", with the short supply in the spot market providing extra support, they said.</p>.<p>Iron ore prices also rose, propelled by restocking demand from Chinese steel mills, with the most-active May contract on the Dalian Commodity Exchange up 3.1% at 1,062.50 yuan a tonne at the close of daytime trading.</p>.<p>The steelmaking ingredient's February contract on the Singapore Exchange gained 1.2% to $167 a tonne by 0709 GMT.</p>.<p>Spot iron ore for delivery to top steel producer China steadied at $168 a tonne on Wednesday, according to SteelHome consultancy.</p>.<p>Construction steel rebar on the Shanghai Futures Exchange advanced 1.7%, while hot-rolled coil jumped 2.9%.</p>.<p>Dalian coking coal gained 1.9% and coke added 0.4%.</p>
<p>China's stainless steel futures extended gains on Thursday, leaping as much as 5%, as higher cost of feedstock nickel and tight supply drove prices higher for the metal used in vehicles and cookware.</p>.<p>The most-active March stainless steel contract on the Shanghai Futures Exchange rose to the day's upside limit of 14,725 yuan ($2,280.72) a tonne, the highest since late October.</p>.<p>The smelting cost of nickel pig iron, the feedstock for stainless steel, remains high because many Chinese smelters are using high-priced nickel concentrate bought recently, according to a Mysteel consultancy report citing a market source.</p>.<p>Prices of nickel continued to rise, with the London Metal Exchange benchmark crossing the $18,000 a tonne level for the first time since September 2019, as extended riots in key producer New Caledonia fuelled supply worries.</p>.<p>Shrinking nickel inventories in warehouses monitored by the Shanghai exchange, which fell by more than half in 2020, have also added pressure on prices.</p>.<p>"The domestic spot premium continues to strengthen, and there is still support under the nickel price," Huatai Futures analysts said in a note.</p>.<p>"The stainless steel futures price may remain strong for the time being", with the short supply in the spot market providing extra support, they said.</p>.<p>Iron ore prices also rose, propelled by restocking demand from Chinese steel mills, with the most-active May contract on the Dalian Commodity Exchange up 3.1% at 1,062.50 yuan a tonne at the close of daytime trading.</p>.<p>The steelmaking ingredient's February contract on the Singapore Exchange gained 1.2% to $167 a tonne by 0709 GMT.</p>.<p>Spot iron ore for delivery to top steel producer China steadied at $168 a tonne on Wednesday, according to SteelHome consultancy.</p>.<p>Construction steel rebar on the Shanghai Futures Exchange advanced 1.7%, while hot-rolled coil jumped 2.9%.</p>.<p>Dalian coking coal gained 1.9% and coke added 0.4%.</p>