Will the Prices of Coking Coal and Met Coke Fall?

SHANGHAI, Oct 22 (SMM) - Yulin City held a special meeting on ensuring coal supply for Q4 on October 19, requiring main coal-producing regions such as Shanxi, Shaanxi, and Inner Mongolia to lower the market coal prices by 100 yuan/mt on the existing basis. The meeting showed the determination of authorities to ensure supply and stabilise prices. 

The purpose is to guarantee household power consumption and to maintain winter heating. Coking coal and coke is not the focus of national control as they are not related to people's livelihood and winter heating. Secondly, the government has repeatedly mentioned the need to maintain a stable supply of electricity coal, rather than coking coal and coke. In the end, the scope of coal supply guarantee does include coking coal, but now the focus of coal mines is on electricity-coal, and even some poor-quality coking coal types have been directly used as electricity coal, resulting in a tighter supply of coking coal, which in turn leads to a decline in coke output.

Therefore, coking coal prices are surely about to increase amid tight supply and coke prices will also trend higher.