* Weekly utilisation rates were at 65.88 pct vs 62.02 pct in 2017 -Mysteel
* Recent dip in global steel prices is temporary due to overproduction in China - Vale
* U.S. finalises duties on some steel pipe from China, India
BEIJING, Dec 7 (Reuters) - China’s steel rebar dropped nearly 2 percent on Friday, but is poised for its best week in nearly five months, reflecting persistent concerns over surplus supply amid high utilisation rates at steel mills.
Steel producers in smog-prone northern China have been ordered to trim down production during the heating season, typically from mid-November until mid-March next year, in an effort to reduce toxic emissions.
China’s central government this year allowed local authorities to set individual capacity cutting rates based on emission level at each plants instead of enforcing blanket cuts.
Weekly utilisation rates at steel mills across the country edged down 0.83 percentage point from previous week to 65.88 percent this week as of Dec.7, data compiled by Mysteel consultancy showed. Despite falling for a third week, the rates are still much higher than 62.02 percent in same period last year.
Brazil’s Vale, the world’s top iron ore miner, also said on Thursday that a recent dip in global steel prices is temporary due to overproduction in China ahead of winter output cuts, with operation rate at Chinese mills at 85 percent.
Benchmark Shanghai rebar futures dropped 1.8 percent to 3,352 yuan ($486.83) a tonne, but gained 4.8 percent so far this week, set to mark their best weekly performance since mid-July.
Steel prices were also dragged by worries over uncertainties between the United States and China.
The U.S. International Trade Commission on Thursday said it had determined that American producers were being harmed by imports of certain large-diameter welded steel pipe from China and India, a finding that locks in duties on those products for five years.
Meanwhile, a top executive at the Chinese technology giant was arrested in Canada and faces extradition to the United States, stirring up fears it could reignite a Sino-U.S. trade row and roiling global markets.
Softer steel prices also weighed on most of raw materials.
The most-active coke futures on the Dalian Commodity Exchange dipped 0.8 percent to 1,942 yuan a tonne, while iron ore futures for May delivery edged down 0.4 percent to 469.5 yuan.
Coking coal futures were up 2.3 percent at 1,443.5 yuan, as of 0157 GMT.
$1 = 6.8854 Chinese yuan Reporting by Muyu Xu and Dominique Patton, Editing by Sherry Jacob-Phillips