[SMM Coking Coal and Coke Daily Brief] 20261016

[SMM Daily Review on Coking Coal and Coke]

Coking coal market:

Linfen low-sulphur coking coal was quoted at 2,250 yuan/mt.

On the coking coal front, the pace of production resumptions at Shanxi coking coal mines accelerated this week, with some mines that had halted production due to working face relocations and safety issues gradually resuming operations. Meanwhile, the negative feedback from steel mills continued, weighing on coking coal. However, constrained by safety inspections and underground conditions, supply growth at most operating mines was limited. In addition, structural shortages of premium skeleton coal varieties, low Mongolian coal inventory, and winter stockpiling expectations provided support for coking coal prices. In summary, spot coking coal prices are expected to consolidate at lows in the short term.

Coke market:

The nationwide average price of quasi-first-grade metallurgical coke (dry-quenched) was 2,200 yuan/mt.

On the news front, it was reported on Friday that the first round of coke price hikes of 50-55 yuan/mt would be proposed next Monday, offsetting the third-round price cut rumors earlier in the week. On the supply side, coke producers continued to ramp up production, with previously suspended or restricted coke enterprises largely resuming production. Although independent coke producers in major producing areas such as Shanxi and Hebei had corresponding production restriction arrangements, the pace of implementation varied, and the actual effect of production cuts was limited. Currently, most coke producers are back in the red, with in-factory inventory continuing to increase, and their willingness to cut production to support prices has risen somewhat. On the demand side, steel mills remained cautious in procurement overall, showing low acceptance of high-priced coke. Steel mill profitability was weak, with production in a loss-making state, and procurement was only made on an as-needed basis. Steel mills shifted from pushing for lower prices to proactively reducing purchase volumes. Overall, hot metal production at steel mills stabilized at low levels, providing basic rigid demand support for coke, but steel mills' controlled purchasing continued to suppress demand. The tug-of-war between coke and steel intensified, and the short-term spot coke market is likely to remain in the doldrums. [SMM Steel]