Chinese domestic metallurgical coke prices were relatively steady this week after the first round of upticks materialized.
CoalMint assessed the latest price for met coke with 12.5% Ash in northern China at RMB 1,910/t or $278.21/t FOB China.
The overall decent profit margins amongst coking plants have fueled up coke producers’ enthusiasm to maintain high operating rates. Steel mills’ purchases based on production demand and sales of coke are smooth. Positive market sentiments are building up, and may spur a second round of price hike for met coke.
North China-based major coke producers expect prices to move higher as the country strives to maintain a high level of crude steel output in the near term. Domestic met coke sales remains strong and demand is expected to be firm going into September and October.
Coking Coal—
China’s domestic coking coal market improved on the back of increased restocking from coking plants, encouraging some producers in Shanxi to raise prices by RMB 10-20/t.
However, Chinese import demand for Australian coking coal is still muted due to tight quotas. Notably, this is a sharp contrast with Mongolian coal arrivals, which surpassed 1,200 trucks at the key border crossing of Ganqimaodu each day.
Recently, certain collieries in Shanxi’s Linfen region are preparing for the national safety standard inspection, leading to reduced output of coking coal and hike in raw coal, though there are no notable changes in prices of mainstream collieries.
It is expected that China’s domestic coking coal price would remain stable in the short term.
Non-Coking Coal—
China’s domestic thermal coal market has been fluctuating on the downward path since entering August, the traditional summer peak season, and may remain weak in the days ahead, due to flat demand amid slowed economic activity.
Industry experts are expecting a recovery in mid or late September in anticipation of positive effect from the routine maintenance to Daqin railway. Recent two derailments at the leading coal-dedicated rail line have caused a fast drop in coal stocks at Qinhuangdao port, though the impact is limited and just temporary.
Rumors about fresh coal import quotas, possibly as much as 10 mn t, been issued to power plants in the northeastern provinces appear to be true, as traders confirmed that more inquiries are heard from the region.
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By Aditya Sinha
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