SMM daily comment on domestic coking coal and coke market (Aug 25)

SHANGHAI, Aug 28 (SMM) –

Coking coal market:

Although some mines in Shanxi shut down due to frequent safety incidents, the resumption of production elsewhere supported supply growth. Since new orders were low and some online auctions failed, coal shipments were mediocre. Traders and coal washing plants held a wait-and-see mentality and downstream procurement was cautious, hence, coal mine quotations are expected to be lowered.

Coke market:

In the fundamentals, acceptable profits of coke enterprises and high production enthusiasm lifted coke production gradually. However, weakening downstream demand slowed down shipments. Steel terminal consumption was less than expected, and profit margins of steel mills continued to narrow, causing a strong willingness to cut coke prices.

Overall, steel mills were still in rigid demand for coke, but coke supply is steadily increasing. Insufficient cost support may result in a downward trend of short-term coke market.