Coal news and updates

China coking coal demand slowly rebounds; prices not yet

Demand for coking coal is slowly rebounding in China’s domestic market, as coke producers started to increase output amid the rise in coal chemical prices backed by a rebound in international oil prices.

Some coke producers have planned to increase production after the National Day holidays over October 1-7, some even have started boosting yield, sources said.

Although inquiries increased recently, some Shanxi-based washing plant sources said end users continued to press down prices.

Prices of low-sulphur primary coking coal and fat coal dropped obviously in Changzhi, Linfen and Luliang, with the price of Luliang fat coal with 0.45% sulphur and 10.5% ash down 30 yuan/t to 570 yuan/t, plus additional discounts for large-volumes buyers.

Low-sulphur primary coking coal price at Qinyuan, Changzhi was cut to 575 yuan/t, while that at Anze, Linfen dropped below 600 yuan/t, sources said.

Coke producers said continuous price cut may impact coking coal supplies, so they now are trying to cut prices of primary coking coal which are relatively high.

Downstream steel market saw a slight rebound since entering September amid improved demand. But steel prices may lack firm support due to climbing steel products stocks at key steel mills and weaker building materials market.

To sum up, China’s coking coal prices may continue to drop in the short run, due to limited traction of downstream demand.

source: http://en.sxcoal.com