Over the past week, the declining trend observed in China's coke market appears to have slowed down with greater stability of prices observed for the moment. Although steel prices have posted a slight price increase, most steel producers are not in a hurry to raise their purchase prices for raw materials. Since the coking plants are currently under great cost pressure, some of them have chosen to limit or even stop production.
Product name | Specification | Place of origin | Average price (RMB/mt) | Weekly change (RMB/mt) | Average price ($/mt) | Weekly change ($/mt) |
Coke | 2nd grade | Shanxi | 1,680 | - | 246 | - |
Shanghai | 1,900 | - | 279 | - |
During the past week the Chinese coke market has generally been in a stable state. At present, the mainstream quotations of second grade metallurgical coke from large scale producers in Shanxi Province remain unchanged at RMB 1,650-1,700/mt ($242-249/mt) with quotations for first grade metallurgical coke still at RMB 1,800/mt ($264/mt). Meanwhile, the purchase prices of Hebei Province-based mills are at RMB 1,750-1,850/mt ($257-271/mt) for second grade metallurgical coke, also unchanged from the previous week. The mainstream prices in the eastern China coke market have remained stable at RMB 1,900-1,950/mt ($279-286/mt). In addition, the mainstream prices of coking coal in the overall domestic market are in the range of RMB 1,350-1,400/mt ($198-205/mt), unchanged week on week.
During the past week, a wait-and-see attitude has been prevailing in the Chinese coke market while most coking companies are in difficulties. In line with the price increases announced by domestic mills, the spot market for steel products has also seen a continuous price rise. However, looking at the current market situation, the price increases for steel are mainly driven by speculation and not by real demand. Although the domestic steel producers dare not to raise their purchase prices for raw materials like coke, most players in the coke market are optimistic on the prospects for the market in the coming period, believing that coke prices will rise up in line with the price increases in other steelmaking raw materials such as iron ore and scrap.
Currently, due to the high prices of coking coal, most domestic coking companies now risk incurring losses, which has been the main reason for them to cut or halt production of late.