* Gains spurred by China's drive to tackle steel
* Shanghai rebar, Dalian iron ore near multi-week highs
* China 2016 iron ore imports hit record 1.024 bln T
(Adds details on China data, updates prices)
By Manolo Serapio Jr
MANILA, Jan 13 Chinese steel and iron ore
futures hovered near a multi-week high on Friday, posting their
best week since November amid Beijing's resolve to trim down its
bloated steel sector.
The main driver this week was China's move to shut
production of low-grade steel products by the end of June, as it
tackles both overcapacity and chronic smog.
The most-active rebar on the Shanghai Futures Exchange
eased 0.6 percent to close at 3,194 yuan ($463) a
tonne. Earlier in the session, it hit 3,247 yuan, near
Thursday's three-week high.
The construction steel product gained almost 9 percent this
week, the most since late November.
Beijing's latest crackdown against sub-standard steel,
targeting small mills that run high-polluting furnaces, will
affect about 4 percent of the country's steel output.
Chinese authorities have dispatched 12 inspection groups to
some areas including top steelmaking province Hebei, as well as
Henan, Guangxi and Heilongjiang, to oversee the move.
Iron ore on the Dalian Commodity Exchange closed
up 0.2 percent at 607 yuan per tonne after earlier touching a
four-week high of 619 yuan. The contract rose 11 percent this
Demand for the steelmaking raw material has been quite
stable, traders said, with Chinese mills still favouring
high-grade material to cope with costly coal prices.
"Steel mills' profits are still ok so they would like to use
better grade material," said a trader in Beijing. "Mills also
need to buy some stocks to prepare for the long Spring Festival
Chinese markets will be shut for a week for Lunar New Year
break from late January.
Iron ore for delivery to China's Qingdao port .IO62-CNO=MB
rose 0.7 percent to $80.99 a tonne on Thursday, according to
Metal Bulletin. It was the highest for the spot benchmark since
Dec. 19, bringing its weekly gain so far to 6.2 percent, also
the biggest since late November.
"Iron ore prices will remain elevated in the coming months
as speculative activity from positive investor sentiment on the
Chinese infrastructure sector rolls on," BMI Research said in a
"However, impulsive increases in production due to the price
rebound, by junior miners, especially those in Australia, could
further flood the oversupplied seaborne market, pushing prices
even lower in the second half of 2017."
China's iron ore imports rose 7.5 percent to a record 1.024
billion tonnes in 2016, and analysts say purchases could stay
high this year.
($1 = 6.8915 Chinese yuan)
(Reporting by Manolo Serapio Jr.; Editing by Randy Fabi and