SMM daily review and forecast for coking coal and coke market (Aug 8)

SHANGHAI, Aug 9 (SMM) –

Coking coal market:

Factors such as safety inspections and replacement of coal working face lessened the output of some coal mines. In addition, good sales left coal mines with no pressure on coking coal inventory. Besides, recent auctions were successfully completed, and most of the transactions were made at a premium, boosting offers for some high-quality coal types. However, muted demand from downstream sectors may drag down the offers.

Coke market:

Fundamentally, a pick-up of delivery for coke and rising demand for coking coal was felt from impact of easing of transportation disruptions caused by early heavy rain. In addition, profit revival slightly pushed up operating rate of coking plants, thereby increasing coke supply, but in-plant coke inventory remained low run.

On the downstream side, with improvement to transportation, coke arrivals at steel mills increased. Besides, low coke inventory of steel mills stimulated the mills to refill stocks. Therefore, robust demand for coke was reported.

On the whole, coke market saw robust demand from downstream sectors and stable-to-higher coking coal prices. In addition, a few coking plants proposed a fifth round of coke price increases, but steel mills with meager profits triggered by falling steel prices were reluctant to accept higher coke prices. In a word, coke market may swing on a stable footing on the near-term horizon.