* Iron ore rides steel strength, up nearly 6 pct to 7-week top
* Rebar and iron ore hit upside limits, along with HRC
* Baosteel, Wuhan Steel plan to restructure (Updates prices)
By Manolo Serapio Jr
MANILA, June 27 (Reuters) - Shanghai steel futures climbed 6 percent to a seven-week high on Monday, propped up by China's efforts to consolidate the sector to improve efficiency amid global calls for Beijing to cut its excess capacity.
China's Baosteel Group 600019.SS and Wuhan Iron and Steel Group 600005.SS , the country's No.2 and No.4 steelmakers are planning to restructure their businesses, but did not give details in separate stock exchange filings on Sunday. announcement came as China's top economic planner said the country is aiming to cut its steel production capacity by 45 million tonnes this year. gives people hope that the industry will be better going forward as the government undertakes supply-side reforms," said Wang Di, analyst at CRU consultancy in Beijing. "Profits of steelmakers will be more sustainable."
The most-traded rebar, a construction steel product, on the Shanghai Futures Exchange SRBcv1 closed up 6 percent at the exchange-set ceiling of 2,268 yuan ($342) a tonne, its strongest since May 9.
Riding on steel's strength, raw material iron ore on the Dalian Commodity Exchange DCIOcv1 rose nearly 6 percent to also close at its upside limit of 411 yuan a tonne, its loftiest since May 9.
From the United States to Europe and Asia, many countries have slapped anti-dumping duties on Chinese steel exports that have hurt their domestic steelmakers. China in February vowed to cut its steel capacity by 100-150 million tonnes over the next five years.
Other analysts say the sharp gains in ferrous futures on Monday reflected investors' perception that steel demand is stronger than thought.
"Investors are betting that the market is stronger than expected. Even if the physical prices look softer, inventories both owned by steel mills and social warehouses are not piling up, suggesting underlying demand remains firm," said Wu Wei, an analyst at Yongan Futures in Hangzhou in China's eastern Zhejiang province.
Other steel and steelmaking commodities also raced higher. Hot-rolled coil in Shanghai SHHCcv1 jumped 6 percent to close at its upside limit of 2,448 yuan a tonne. Dalian coke DCJcv1 surged 6.5 percent to 938.50 yuan per tonne and Dalian coking coal DJMcv1 rose 3.5 percent to 734 yuan.
($1 = 6.6376 Chinese yuan)