- Demand declines amid falling hot metal output
- Mills may propose another price cut this Friday
Mysteel Global: In comparison with the recent uptrend in the futures market, the Chinese spot metallurgical coke market stayed lacklustre as of 17 June. With the lingering weakness in fundamentals, participants generally held negative views on the near-term market, sources noted.
Yesterday, the national composite met coke price assessed by Mysteel settled at RMB 1,171.8/tonne (t) ($163/t), including 13% VAT, down by a minimal RMB 0.1/t from the previous session.
China’s met coke futures mounted for the third consecutive day yesterday. On 17 June, the most-traded met coke contract for September delivery on the Dalian Commodity Exchange rose by another 1% from the previous session to close the daytime trading session at RMB 1,365.5/t.
Some participants therefore expected that spot met coke prices may bottom out if the rallying futures prices could give a boost to speculative trades in the spot market as well, market sources noted.
However, a Shanghai-based analyst pointed out that recent futures gains, instead of indicating a virtual market turnaround, should rather be regarded as a delayed adjustment from the previous persistent fallbacks incurred by pessimistic anticipations.
Indeed, China’s spot met coke market extended the weak performance yesterday. While steelmakers’ demand for met coke was declining with the falling output of hot metal, most participants sustained their negative outlook for the market.
In fact, rumours were heard that steelmakers might propose another price cut on met coke this Friday, sources reported, indicating the lingering downside pressure on the met coke market.
Yesterday, China’s portside met coke market reported drops in tandem. On the same day, Mysteel’s assessment for the first-grade met coke (ash 12.5%, sulphur 0.65%, CSR 65%, MT 7%) dropped by RMB 10/t d-o-d to RMB 1,270/t, while the quasi-first-grade met coke (ash 13%, sulphur 0.7%, CSR 60%, MT 7%) was also assessed lower by RMB 10/t at RMB 1,170/t, both on an ex-stock basis at Qingdao Port in eastern China’s Shandong, with the 13% VAT included.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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