The ongoing mixed outlook in the international steel market, in particular, in China has continued to take its toll on sentiments in the coking coal segment in China. Specifically, despite the successful implementation of a price hike for met coke this week, Chinese producers of metallurgical coke have opted to remain quite cautious towards bookings of import coking coal. “There is no real demand to keep the prices up,” a market source stated. “I do not know if there is much room to go ahead. End-product prices are really poor,” a major international trader commented with regard to the developments in the raw material segment against the backdrop of the current situation in the finished steel market. “A swap future is at $270/mt FOB for December contracts. This is absolutely incomprehensible. While Europe might be in a crisis or recession in December, in China it is the weakest month,” an Asian source commented regarding recent global coking coal market developments.
Meanwhile, at the beginning of the current week Russia-based Mechel sold a cargo of K10 coking coal, with prompt laycan at $205/mt CFR. Since the end of July, the company has succeeded in signing contracts above $200/mt CFR. Meanwhile, an ex-US cargo of premium hard coking coal Blue Creek No7, for late August/early September-laycan has been reportedly offered at $330/mt CFR China, up around $20-25/mt since the previous week, while the customers have been seeking to pay not higher than $260-300/mt CFR. Offers for import low-volatility pulverized coal injection (PCI) have been heard at $165/mt CFR this week.
In the meantime, as SteelOrbis reported earlier, first-grade coke prices in China have been settled at RMB 2,630-2,730/mt ($388.5-422.5/mt), increasing by RMB 200-240/mt ($28-34/mt) compared to levels a week ago. Ex-China export prices for 25-90 mm blast furnace (BF) grade coke (62/60%) have increased to $405/mt FOB, up $5/mt over the week.
Meanwhile, futures prices at Dalian Commodity Exchange (DCE) have soared within the past week. Accordingly, on Friday, August 12, coking coal prices at Dalian Commodity Exchange (DCE) have settled at RMB 2,189.5/mt ($325/mt), up RMB 101.5/mt ($16/mt) from Friday, August 5. Meanwhile, coke futures prices have increased by RMB 167.5/mt ($25/mt) to RMB 2,982/mt ($442/mt) in the given period.
$1 = RMB 6.742