SHANGHAI, Jan 17 (SMM) - Coking coal market: With the Chinese New Year holiday around the corner, downstream demand declined, and market transactions were lower than expected. However, as some coal mines already took holidays, the supply of coking coal was also tight, hence the supply and demand were both weak in the market. The quotes of coking coal stabilised with limited inventory at coal mines.
Coke market: On the supply side, coking enterprises were not enthusiastic about production on narrowed profit margins, and some loss-making coking enterprises slightly reduced their production. Therefore, the average operating rate of coking enterprises continued to fall. On the demand side, the profits of steel mills were restored slightly, and their coke inventories were lower compared with previous years. This, coupled with the disrupted transportation amid snow and rain, prompted some steel mills to be less tough in bargaining down coke prices.
On the whole, the downstream demand for still exists, and the profits of steel mills have partially restored. The limited decline in coking coal price suggests that the cost support for coke prices still remains. It is expected that the coke prices may remain largely stable in the short term.