Against the background of growing market demand both at home and abroad, China's domestic coke market has registered an overall rise during the past week, with production costs, in particular, and also transportation difficulties helping to boost up domestic coke prices.
Product name | Specification | Place of origin | Average price (RMB/mt) | Weekly change (RMB/mt) | Average price ($/mt) | Weekly change ($/mt) |
Coke | 2nd grade | Shanxi | 1,600 | 50 | 235 | +7 |
Shanghai | 1,750 | 50 | 249 | +7 |
China's domestic coke market has posted an overall rise throughout the past week. At present, the mainstream quotations of second grade coke from large producers in Shanxi Province are in the range of RMB 1,550-1,600/mt ($227-235/mt), while Hebei Province-based mills have issued purchase prices at around RMB 1,650-1,700/mt ($242-249/mt) for second grade coke. Meanwhile, the mainstream prices in the eastern coke market are at RMB 1,700-1,800/mt ($249-264/mt). In addition, the mainstream prices of coking coal in the domestic market have risen RMB 50/mt ($7/mt) week on week to the range of RMB 1,250-1,300/mt ($183-190/mt).
Market demand, production costs and transporation blockages due to heavy snowfalls in the north have all contributed to the overall ascension of the Chinese coke market during the past week. First of all, market demand for coke has been growing continuously. In line with the gradual recovery of the global macroeconomy, steel demand is expected to continue to pick up in both domestic and internatonal markets. Meanwhile, domestic coke producers have seen a general increase in their production costs. Since the merger activity involving coal mines in Shanxi Province has not yet been concluded, many mines have failed to maintain their normal output levels. Moreover, due to the accident at Hegang coal mine, the Shanxi government carried out safety inspections recently, leading to production halts at some mines and causing a further reduction in coal production. Thus, given the tight availability in recent days, coking coal prices have climbed up accordingly. At present, mainstream prices of coking coal in Shanxi Province are around RMB 1,300/mt ($190/mt). In this context, cost pressure has become the most important factor providing support for coke prices, and is expected to continue to do so in the short term. In addition, affected by the heavy snowfalls in the north during the first half of November, transportation remained blocked in many regions, which also impacted the coke supply to a certain extent.
According to new figures, China's coke exports for October totaled 53,000 mt, up 32.24 percent month on month. Meanwhile, coke exports in the January-October period reached 430,000 mt.