Despite declines in futures prices for coking coal and coke in China over two consecutive days due to demand uncertainties, the physical market has remained very strong fueled chiefly by the supply-demand imbalance. “China's physical market is really intact. Tighter domestic coking coal supplies still weigh on prices,” a trader based in Singapore stated.
Consequently, quotations of premium hard coking coal from Canada have soared to around $383/mt CFR, up $52.5/mt over the past week.
Meanwhile, the current coke prices in Tangshan have reached RMB 3,060/mt ($481/mt) ex-warehouse this week, up by RMB 200/mt ($31.4/mt) compared to January 7. A further rise is expected to occur in the coming week. “There is a proposal for a fourth round of price hikes by RMB 200/mt and most probably it will be accepted over the weekend,” a source told.
In the futures market, in turn, on January 14, the prices of coking coal and coke have continued to move down further. Specifically, the price for hard coking coal in the most-traded contract on China’s Dalian Commodity Exchange (DCE) declined by 0.22 percent on the day in question to RMB 2,299.5/mt ($362/mt). Meanwhile, coke futures prices have moved down to RMB 3,082/mt ($485/mt), declining by 0.77 percent compared to the previous day.
Meanwhile, the latest bid for a March shipment cargo of premium low-volatility hard coking coal (HCCLV) has been fixed at $410/mt FOB Australia. “The current figures are really bullish. It is becoming more and more interesting,” a trader commented.
$1 = RMB 6.3528