Coke guideline price for June likely to go up in Shanxi

The Chinese domestic coke market continued its overall rising trend throughout the past week. Coking enterprises in various regions have lately seemed to be preparing to again raise their ex-factory prices of coke for June in the context of the mills' relatively strong purchasing activity. In addition, with the continuous recovery seen in the finished steel market, China's domestic crude steel production is still on a rising trend, indicating the likely continuation of strong demand for coke in the future.

Last week China's domestic coke market maintained its upward trend on the whole. At present, the mainstream quotations of second grade coke from large producers in Shanxi Province are unchanged at the level of RMB 1,550/mt ($227/mt), while Hebei Province-based producers have still maintained their ex-factory prices for second grade coke at the level of RMB 1,650/mt ($242/mt). Meanwhile, the prices of second grade coke in Huaibei, Anhui Province are still in the range of RMB 1,550-1,650/mt ($227-241/mt). Additionally, the market prices of coking coal have risen RMB 50/mt ($7/mt) to RMB 1,150-1,200/mt ($168-176/mt).

In recent days, buyers have been showing eagerness in coke sourcing activities, thus contributing to the brisk trading performance in various coke markets and to the positive sales performance of coke producers. Meanwhile, it is heard that the Shanxi Coking Industry Association is likely to hike the guideline price of coke again by a margin of RMB 60/mt ($9/mt) to the level of RMB 1,720/mt ($252/mt) for June. Following the upward adjustment made to guideline prices in May, coking enterprises in Shanxi Province and other regions have generally reached a breakeven point. Thus, if coke prices see another rise, the coke producers will be able to make a profit.