The Chinese coking coal market remains weak on the whole. While transactions are still low, the market is stabilizing following price cuts made by larger miners earlier this month and extensive approvals of infrastructure projects by the central government.
The CR China Coking coal price Index (CRCP) issued by China’s premier industry consultantant Fenwei Energy Consulting Co Ltd, which reflects the average price of coking coal throughout China, remained 508.802 points on Sep 24, unchanged for three consecutive weeks and down 27.88% from this year’s high of 705.471 points in early April.
In Shanxi, the country’s top coking coal production base, prices are stable but transaction volumes are still low with no apparent sign of improvement. In areas where production cuts have been significant, miners are mulling over a price hike but still waiting to see further changes in the market, according to the local sources with industry portal China coal resource (CCR), which is operated by Fenwei Energy.
The price cuts of CNY 80 per tonne to CNY 150 per tonne made by Shanxi Coking coal group earlier this month, according to key end users in northeastern China, are mainly due to the group’s higher prices compared to the other miners. In a response to weaker demand, Shanxi Coking Coal has been cutting production since June. The latest official data indicates that the group’s total output in August dropped 20.7% from the month before to 7.82 million tonnes.
In neighboring Hebei province, coking coal prices are temporarily stable, with primary coking coal (volatile mater less than 28%, sulfur 0.8% and G value above 90) staying at CNY 1200 per tonne including VAT. Miners are likely to raise prices later in the month stimulated by the recent positive changes such as the rise of construction steel prices and government approvals of infrastructure projects, several local sources told CCR.
In northeast China, an insider at Heilongjiang-based Longmay Group confirmed with CCR that its company has recently lowered September prices for various qualities of coking coal by approximately CNY 50 per tonne. Local miners also cut prices to a similar extent, the insider added.
Source - en.sxcoal.com
(www.coalguru.com)
