With a successful third round of price hikes by the end of last week, Chinese coke plants have secured a certain room for themselves in accepting a further increase in prices for coking coal. In particular, given a high chance of logistical bottlenecks caused by the impact of Western sanctions and due to bad weather conditions, ex-Russia coking coal prices appear not to have reached high levels yet. Apart from that, some disorder in coal transportation from Mongolia due to protests has exacerbated concerns among Chinese customers. Consequently, Chinese cokeries have once again accepted higher prices in fresh ex-Russia coking coal deals, thereby strengthening the bullish trend. Furthermore, if China normalizes trade ties with Australia, the likelihood of re-emerging Chinese demand for ex-Australian coal may squeeze the global balance further, providing support for prices.
SteelOrbis has learned of a fresh trade of ex-Russia Deni Deep coking coal at $240/mt CFR. Though the deal price is at the low end of prices targeted by the supplier, it is around $2-5/mt higher compared to the levels at the end of November. Besides, a 21,000 mt cargo of ex-Russian K10 coking coal, produced by Mechel has changed hands at $265/mt CFR, for prompt shipment, up $10/mt compared to the results of the previous tender closed in early December at $255/mt CFR. Fresh offers for ex-Russia low-volatile pulverized coil injection (PCI) have been heard at $250/mt CFR and higher. As SteelOrbis reported earlier, the highest price was seen in the deal done at the end of November at $247/mt CFR, for December shipment.
In the meantime, as of Tuesday, December 13, coking coal futures prices in the most traded contracts at Dalian Commodity Exchange (DCE) have settled at RMB 1,938/mt ($278/mt), up 3.75 percent compared to Friday, December 9. Meanwhile, coke futures prices have risen by 0.2 percent to RMB 2,940.5/mt ($421.3/mt).
$1 = RMB 6.97975