- Prices face sustained pressure from steelmakers
- Coke futures dip 1.2% amid worries over 4th price cut
Mysteel Global: The Chinese metallurgical coke market remained in the downturn as of 9 June, with participants sustaining their gloomy outlook for the near future.
Yesterday, Mysteel’s assessment of the national composite met coke price remained flat from the previous session at RMB 1,175.5/tonne (t) ($163.6/t), including the 13% VAT. However, domestic met coke prices may dip soon, with downward pressures looming large.
Right after the materialisation of the RMB 70-75/t price cut on met coke on 6 June, two major steelmakers in Tangshan city, North China’s Hebei province, were heard to pare their purchasing prices for top-charged met coke products by another RMB 20/t yesterday, effective the same day, market sources reported.
Steelmakers’ relentless request for lower feed material prices recently reflected their concerns over profitability amid the slack season for steel consumption, as reported.
As of yesterday, with heavy rains lingering in southern China, demand for steel products remained subdued, causing fluctuations in prices, according to a Shanghai-based analyst.
On Monday, the national price of HRB400E 20 mm diameter rebars under Mysteel’s assessment nudged down by RMB 4/t from last Friday to RMB 3,228/t, including the VAT, snapping the uptrend over the prior three working days.
While the seasonal lull continued, steel mills’ expectations for the future steel market in tandem grew dimmer. To protect their profit margins, steelmakers intend to keep pressing down their costs for raw materials, according to sources.
Coke makers now worry that a fourth reduction on met coke prices is still to come in the latter half of June, sources added.
With the gloomy outlook dominating, market sentiment remained dampened, leading to losses in the futures market yesterday. On the Dalian Commodity Exchange, the most-traded met coke contract for September delivery dropped by 1.2% from the previous session to RMB 1,339/t at the end of its daytime trading session on 9 June.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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