Morning Comment: Coke Demand Increases amid Improving Sales of Steel Mills

SHANGHAI, Feb 27 (SMM) - On February 24, the transaction prices of first-grade metallurgical CQD in Luliang, Shanxi were 2,890 yuan/mt (ex-factory), flat from the previous day.

A major coal accident occurred in a coal mine in Inner Mongolia, hence the supply of coking coal is expected to decrease and the downstream demand has increased. As such, the prices began to rise.

On the supply side, despite the declining profits, coke companies were still active in production under the expectations of price increase. Therefore, the supply of coke increased slightly. On the demand side, the sales of steel mills have improved significantly and there is no maintenance plan, hence the demand for coke increased.