[SMM Coal and Coke Analysis] Weak Demand Poses a Slight Risk of Inventory Buildup for Coke Producers

This week, coke inventories at coking plants stood at 359,000 mt, up 11,000 mt WoW, an increase of 3.2%. Coking coal inventories at coking plants reached 3.08 million mt, up 38,000 mt WoW, an increase of 1.2%. Coke inventories at steel mills totaled 2.956 million mt, up 28,000 mt WoW, an increase of 1.0%. Coke inventories at ports were 1.15 million mt, down 0.7%, a decrease of 10,000 mt WoW.

This week, the operating rate of coking plants increased slightly, and coke supply rose accordingly. However, downstream steel mills maintained relatively high coke inventories, and their sales performance fell short of expectations. Coking plants barely achieved a balance between production and sales, with coke inventories fluctuating slightly. In the coming week, coke supply is expected to remain stable, while steel mills maintain a cautious sentiment. Coke inventories at coking plants may increase slightly next week.

This week, coking coal prices declined, but coking plants showed average production levels and low willingness to restock coking coal, resulting in relatively small changes in their coking coal inventories. Moving forward, coking coal prices are expected to decline further, but most coking plants are likely to maintain a low willingness to restock. Coking coal inventories at coking plants may increase slightly next week.

This week, coke prices remained stable, but some steel mills have already issued notices for the fifth round of coke price cuts. Coupled with weaker-than-expected terminal production, steel mills showed low procurement enthusiasm and maintained a wait-and-see attitude. In the coming week, spot coke prices are expected to decrease, combined with a decline in pig iron production at steel mills, leading to reduced coke sales. Coke inventories at steel mills may increase slightly next week.

This week, coke supply remained ample, and bearish sentiment in the market was evident. The fifth round of coke price cuts is likely imminent, while speculative enthusiasm among traders remained low. Coke inventories at ports are expected to decline slightly next week.