Game Between Coke and Steel Companies is Ongoing

SHANGHAI, Feb 7 (SMM) - Coking coal:

Production resumption scale of coal mines expands when the Lantern Festival holiday is over, and the output grows. However, traders delayed their acts and downstream companies purchased cautiously. This weighed on the shipments of some coal mines. Coking coal prices were on a downward trend and are likely to drop further.

Coke:

On the supply side, the traded prices of coking coal have dropped recently, reducing the cost of coke companies. Purchases of coke by steel mills has returned to normal and some traders shipped their goods to various places. The finished product inventories held by coke companies declined.

On the demand side, coke stocks carried by steel mills have begun to increase, but steel prices have fallen recently. The mills became more cautious about purchasing coke with the fall in profit margins.

In general, the coke supply and demand tend to be balanced, and coke plants which suffered palpable losses were reluctant to lower the coke prices. But the market sentiment weakened as the steel prices dropped. The game between coke and steel companies is ongoing. It is expected that coke prices will be stable with some possible drops in the short term.