SMM Daily Comment On Domestic Coking Coal And Coke Market (Sep 22)

SHANGHAI, Sep 25 (SMM) –

Coking coal:

Low-sulfur coking coal in Lvliang, Shanxi was quoted at 2,100 yuan/mt, while the quotation in Linfen was 2,150 yuan/mt and 2,100 yuan/mt in Tangshan.

Stricter safety inspections in Shanxi and Shaanxi led to tight supply. Besides, pre-holiday stock replenishment promoted coal mines’ shipment, keeping inventories at a low level. Online auctions saw many transactions at premium prices and market ran strongly.

Coke:

The national average price of first-grade metallurgical coke-CDQ is 2,560 yuan/mt, the national average price of quasi-first-grade metallurgical coke-CDQ was 2,420 yuan/mt, the national average price of first-grade metallurgical coke-wet quenching was 2,140 yuan/mt, and the national average price of quasi-first-grade metallurgical coke-wet quenching was 2,058 yuan/mt.

The first round of coke price hikes was fully implemented, easing the losses of coke companies. However, high coal costs depressed the profits of coke enterprises and caused their production reduction. In-factory inventories of coke plants dropped further and tightened supply. On the demand market, steel mills maintained stable operating rates and rigid demand for coke. With the National Day holiday approaching, pre-holiday replenishment needs of steel mills fueled procurement enthusiasm for coke.

Overall, production restrictions on coke companies and the replenishment needs of steel mills intensify the tightness of supply and demand. Supported by robust cost support, coke market may continue to move upward in the short term.