MANILA, Jan 18 (Reuters) - Prices of steel and steel-making
raw materials in China rose on Friday, with iron ore hitting its
highest in more than 10 months and rebar posting the best week
in more than a month, amid optimism over progress in the
U.S.-Sino trade talks.
    U.S. Treasury Secretary Steven Mnuchin discussed lifting
some or all tariffs imposed on Chinese imports and suggested
offering a tariff rollback during trade discussions scheduled
for Jan. 30, the Wall Street Journal reported on
Thursday.            
    Mnuchin had not made any such recommendations, while the
Journal said trade representative Robert Lighthizer had resisted
the idea, a Treasury spokesman said. 
    The most traded iron ore on the Dalian Commodity Exchange
          gained 3.2 percent to close at 528 yuan ($78.01) a
tonne, just below the day's peak of 530 yuan, its highest since
early March last year.
    "The signs out of the recent trade talks in China are
promising and have boosted market optimism, despite the lack of
concrete outcomes," ANZ Research said in a note.
    The recent market rout and weak data coming out of China may
force two of the world's largest economies towards a deal, it
said.
    With a deal that could help China avoid a sharper economic
downturn, "everything will be back to normal, and demand (for
steel) will be coming back, and that will support iron ore
price," said Helen Lau, analyst, Argonaut Securities. 
    Ahead of Friday's trading, global miner Rio Tinto         
said it expected to produce more iron ore in 2019, after logging
a slight drop in quarterly iron ore production in December.
            
    Supply-related issues also supported iron ore prices this
week. Rio Tinto, the world's No. 2 miner of the steelmaking
material, declared force majeure on shipments to some customers
following a fire at its Cape Lambert export terminal in
Australia.             
    The most-active rebar contract on the Shanghai Futures
Exchange          rose 2.3 percent to 3,633 yuan a tonne, just
below the day's high of 3,636 yuan, and posted its sixth weekly
gain in seven weeks.
    Hot rolled coil          was at 3,518 yuan a tonne, up 1.9
percent. 
    Coking coal          climbed 0.8 percent to 1,238 yuan,
after declining for three consecutive days. 
    Coke          rose 1.6 percent to 2,065.5 yuan. Earlier in
the session, it hit 2,075.5 yuan, its highest in more than two
months.