SMM daily comment on coking coal and coke market (Aug 10)

SHANGHAI, Aug 11 (SMM) –

Coking coal market:

Some coal mines stopped or reduced production, while slower demand from downstream sectors reported. Coking coal market activity weakened. In addition, more online auctions failed to be made. The transactions of some coal types with higher premiums shrank.

Coke market:

In terms of fundamentals, given that coke stocks at coking plants declined amid smooth delivery, some coking plants slightly increased production, thereby increasing coke output, while demand from steel mills was felt from impact of operation resumption and low coke stocks at steel mills. However, sliding prices of finished products squeezed profits of steel mills. Therefore, steel mills were reluctant to accept the fifth round of coke price hikes.

On the whole, coke supply increase, falling prices of finished products and sluggish terminal demand slightly made a dent in the bullish sentiment in the market. However, operation rate of steel mills stood high, bringing with it replenishing demand for coke. In addition, coke stocks at steel mills remained low and cost support remained strong. Under such circumstance, coke market will probably swing on a stable territory in a short run.