China’s coke exports are expected to surge noticeably in February amid robust purchases from India, Sxcoal learned from some trader sources.
“The coke inflows to eastern ports in Shandong moderately improved, partly ascribed to the warmer demand from foreign orders, especially from Indian buyers,” one Rizhao-based trader source said.
Kpler’s data showed the predictive coke exports in China could surge to a one-year high in February, second only to a peak registered in February last year.
Indian buyers scrambled for coke in China partly due to the available supplies in the country was restrained due to low capacity utilization to rein in pollutions during the Winter Olympic Games, Sxcoal learned from an India-based source.
Sxcoal data showed on February 10 the capacity utilization at the surveyed coking plants decreased 3.66 percentage points week on week, as some production areas in Shanxi, Shaanxi, Hebei and Shandong tightened production curbs.
Higher price competitiveness of Chinese coke compared with domestic supplies, with a spread roughly at $50/t, was also behind the buying zest, the Indian source said, adding a revival of domestic steel demand to meet the robust construction and infrastructure demand prompted buyers to increase shipments from China.
China’s met coke prices dropped by totaling 400 Yuan/t since the Lunar New Year holiday, and stabilized amid a standoff on the third round of coke price cut.
Major steelmakers became much cautious in pressing down coke prices, in a time when traders shifted to an active purchase stance and replenishment from some low-stocked steel mills also gathered pace.
Coke producers were reluctant to reduce coke prices further, Sxcoal learned from some producers, with emerging sign that coking coal prices would stabilize by the end of the month or even earlier.
While most participants still foresaw a downward space for coking coal in the remainder of the month, auction prices in a few cities in Shanxi slightly increased.
An auction of 1/3 coking coal (S 0.6%, A 10.5%) in Linfen of Shanxi was settled at 1,850 Yuan/t from a start level of 1,600 yuan/t on February 17. The strike price was 200 Yuan/t higher compared with the preceding week, Sxcoal understood from some local sources.
Other mines in the surrounding cities were also inclined to hold offers unchanged, backed by improved purchases from coke producers due to low stocks.
Sxcoal data showed coking coal stocks at the surveyed independent coking plants and steel mills dropped 12.03% and 8.37% respectively compared with the week-ago levels on February 14.
Chinese participants are generally bullish over the March market for both coking coal and coke, as an expected resumption in steel production would shore up prices of the materials
This article has been exchanged under article exchange agreement between SX Coal and Coalmint
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