Chinese metallurgical coke export prices have shot up to the highest levels since the beginning of the year on the back of a recovery in Northeast Asian steel output.
Average spot prices for China-originated met coke have gone up by $10-15/t so far in September on FOB basis.
Meanwhile, China’s domestic met coke prices remained supported at higher levels amid supply tightness, coupled with firm demand despite shrinking steel margins.
The decent profit margins – being generated by coking plants after the second round of price uptick by CNY 50/t was accepted by steel mills – have uplifted coke producers’ interests to maintain high operating rates.
CoalMint assessed the latest price for Chinese domestic met coke with 12.5% Ash at CNY 1,960/t DDP North China, up by CNY 30/t week-on-week.
Coking coal market gaining momentum
China’s domestic coking coal market has been witnessing a marked improvement on the back of increased restocking from coking plants, encouraging some producers to marginally raise prices.
It is expected that China’s domestic coking coal price would remain stable in the short term.
Chinese import demand for Australian coking coal is yet to recover, primarily due to import quota limitations and port-related concerns. This is a sharp contrast with Mongolian coal arrivals to China since the last month.
The total number of trucks crossing the Mongolia-China border increased to 2,001 as of August 26 compared with 919 as of July 25.
Non-Coking coal market to continue downward trend
China’s domestic thermal coal market has been fluctuating on the downward path since last month and may remain weak in the near term, due to subdued demand amid slowed economic activity.
Industry experts are expecting a recovery by late September in consideration of fresh coal import quotas, possibly as much as 10 mn t, issued to power plants in the northeastern provinces, as traders confirmed that more inquiries are heard from the region.
Abbreviations
DDP = Delivered Duty Paid
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By Aditya Sinha
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