For dry-quenching quasi-first-grade met coke, the prevailing offers in North China’s Shanxi province ranged between yuan 2,090-2,120/t, while offers in East China’s Shandong were within yuan 2,220-2,280/t, both on exw basis and including VAT, market sources said.
On Tuesday, Mysteel’s assessed price of China’s national composite coke also dropped by yuan 92.5/t on day to sit at yuan 2,006.9/t including VAT.
The latest cut in coke prices came after steelmakers rejection of an increase in coke prices that coke firms had proposed two weeks ago. Instead, steelmakers pushed down coke prices with their confidence propped up by retreating coking coal prices. “As feed coal costs dwindled, the cost support for coke prices also weakened,”a market watcher commented.
After the coke price drop, many coke firms once again slipped into losses. On 21 May, coke makers in Shanxi generally lost yuan 59/t on average for selling wet-quenching quasi-first-grade met coke, in stark contrast to a profit of yuan 25/t on the previous day, Mysteel’s survey showed.
Previously, growing profit margins had enticed coke firms to lift their operation. The average capacity utilisation rate of the 230 independent coke makers under Mysteel’s tracking have been on the rise in the past weeks, touching a four-month high at 72.7% during 9-15 May.
However, the shrinking profit margins have dampened their production interests again, as sources revealed that some coke makers planned to rein in their production again. In this scenario, the shortfall in coke supplies is expected to persist in the near term, Mysteel Global learned.
At Rizhao and Qingdao ports in East China’s Shandong province, coke stocks totalled 1.58 million tonnes (mnt) as of 21 May, down by 120,000 tonnes on week, Mysteel’s tracking data show.
Note: This article has been written in accordance with an article exchange agreement between Mysteel Global and BigMint.