* Coke futures jump nearly 6 pct to five-week high
* Safety inspections curb output at China’s coal mines (Recasts, adds analyst comment, updates prices)
By Manolo Serapio Jr and Muyu Xu
MANILA/BEIJING, Dec 7 (Reuters) - Chinese coking coal futures jumped to their highest in nearly 15 months on Friday, supported by tighter supply amid safety checks at coal mines, while coke surged nearly 6 percent to a five-week high.
The most-traded January coking coal contract on the Dalian Commodity Exchange rose as high as 1,464 yuan a tonne, its loftiest since mid-September 2017. It closed up 3.1 percent at 1,455 yuan.
The price of coke - the processed form of coking coal - settled 5.3 percent higher at 2,063 yuan per tonne, after peaking at 2,074 yuan, its strongest since Oct. 29.
China’s coal mine safety watchdog launched inspections of mines across the country from late October to end-June next year to improve safety conditions.
The move followed an accident at a coal mine in eastern Shandong province in October that killed eight people, prompting authorities to order 41 coal mines there to halt production for security checks.
“As the year-end approaches, the government’s priority is safety,” said Richard Lu, analyst at CRU consultancy. “Even though coal mines are ramping up production they have not reached normal capacity so coking coal supply is restricted.”
Lu said the surge in coke prices was largely linked to the improved sentiment in the steel market earlier this week following the 90-day ceasefire in the trade dispute between the United States and China.
“Coke producers are running at very high utilisation rates, we haven’t heard any kind of restrictions related to environmental protection,” he said.
China has allowed cities and provinces to set their own production curbs as part of its anti-smog campaign this winter, ditching last year’s blanket restrictions. It’s a move that analysts say could boost steel output as well as demand for raw materials like coke.
Dalian iron ore futures rose 0.7 percent to 475 yuan a tonne. Rebar on the Shanghai Futures Exchange slipped 0.4 percent to 3,397 yuan.
Utilisation rates at steel mills across China dropped 0.83 percentage points from the previous week to 65.88 percent on Friday, data compiled by Mysteel consultancy showed. Despite falling for a third straight week, the rate is higher than the year-earlier’s 62.02 percent.
Top iron ore miner Vale said on Thursday that a recent dip in global steel prices is temporary and due to overproduction in China ahead of winter output cuts. (Reporting by Muyu Xu in BEIJING and Manolo Serapio Jr. in MANILA Editing by Kenneth Maxwell)