Steel drops

Manila

Chinese steel futures dropped to pull away from 4-1/2-year highs reached this week, with an industry group warning that market speculators were driving up prices unnecessarily.

Officials from the China Iron and Steel Association (CISA) met with steel producers, brokerages and research consultancies on Wednesday and agreed that the recent price spike was "not driven by market demand or reduced market supply".

Instead, some organisations were "over-interpreting, or even mis-reading" the effect China´s environmental policies and clampdown on low-quality steel would have on production capacity in the second half of 2017, according to a statement from CISA posted on its official Wechat account.

The most-active rebar on the Shanghai Futures Exchange was down 0.7 percent at 3,942 yuan ($591) a tonne by 0224 GMT, after hitting an intraday peak of 4,016 yuan on Thursday, its strongest level since March 2013.