Analysis on Market and Trading Tips

Keys Points: From Monday to Tuesday, price of domestic metallurgical coke was stable; that of coking coal, PCI and thermal coal went up amid stability.

Further attention should be paid to:

1) changes in market price, transaction and inventory of steel;

2) changes in coke inventory between industrial chains;

3) fluctuations of iron ore price;

4) profit restoration of steel mills.

Met Coke: Early this week, price of metallurgical coke was stable after the third round of price hike. Price in East, North and Northeast China was mainly stable.

Coking plants in Central South China pricing on a monthly basis did not informed steel mills new price in October, which was expected to rise by 80 yuan, an acceptable number to steel mills. Price of leading steel mills in Yunnan-Guizhou picked up by 80 yuan while leading coking plants insisted on a price hike of 100 yuan. Some coking plants continued to raise the price in the first half of October by 30-50 yuan to meet a cumulative growth of 130 yuan. However, some steel mills expressed that 30-yuan gorwth was at most.  

Currently, most coking plants ship actively with no plan to adjust price. Steel mills are active in production, showing great demand on metallurgical coke. It’s expected that domestic metallurgical coke price will stay at a high level.

Table 1: Price of Domestic Standard I Grade Metcoke in Spot Market (yuan per ton)

Source: SteelHome Database (Note: Metcoke index in Yunnan and Guizhou provinces is A14CSR60; index of standard I metcoke is A13%, CSR60%.)

Coking Coal: Domestic coking coal price went up amid stability this week. Price of coking coal from Shanxi leading mines in the fourth quarter transported by trains was mainly stable.

Price of lean coal, lean and meager coal in Changzhi rose by 20 yuan. Most coal mines had plan to rise the price by 20-30 yuan in October because of limited production caused by National Intelligent Inspection Conference in Shandong.

Table 2: Domestic Coking Coal Price Changes (yuan per ton)

Source: SteelHome Database

PCI: Price of domestic PCI went up amid stability from Monday to Tuesday; that at origin and purchase price by steel mills stayed the same.

Price of PCI in Changzhi, Shanxi increased by 20 yuan to 680-730 yuan/t (in cash); that of anthracite from several coal mines in Jincheng edged up by 30 yuan.

Bidding price of PCI from some steel mills in Qianan, Hebei surged; that of anthracite rose by 30 yuan to 859 yuan/t (in cash); that of PCI bituminous rose by 28 yuan to 703 yuan/t.

Table 3: Domestic PCI Price Changes (yuan per ton)

Source: SteelHome Database

Thermal Coal: Price of domestic thermal coal went up amid stability from Monday to Tuesday. FOT price of thermal coal (Q5500) in stock increased by 9 yuan to 606-611 yuan/t fob Qinhuangdao from last Friday.

Inventory at Qinhuangdao Port dropped by 30,000 t to 5.005mn t from last Friday. In terms of production areas, price in Yulin, Shaanxi increased amid stability.

It’s expected that price growth of thermal coal at ports will slow down while that at production will be high.

Table 4: Changes in Domestic Thermal Coal Price and Inventory at Ports (yuan per ton)

Source: SteelHome Database

Hot Topics:

1, Recently, All-china Federation of Trade Unions under National Energy Administration gave out guidance on standardizing coal mine labor employment to promote safety production, mainly on the following four aspects: standardizing labor dispatching and employment; standardizing working hours; enhancing salary and professional qualities.

2, Treatment of air pollution on 2020-2021 Autumn in Beijing-Tianjin-Hebei and surrounding areas together with Fen-Wei Plain was issued. Main targets are separated into two parts, summarized as follows:

From October to December 2020, the average concentration of PM2.5 in Beijing-Tianjin-Hebei and surrounding areas shall be controlled within 63 micrograms/cubic meters, and the average number of days of heavy pollution and above in each city shall be controlled within 5 days; the average concentration of PM2.5 in the Fen-Wei Plain shall be controlled within 62 micrograms/cubic meter, the average days of severe pollution and above in each city shall be controlled within 5 days.

From January to March 2021, the average concentration of PM2.5 in the Beijing-Tianjin-Hebei region and surrounding areas shall be controlled within 86 micrograms/cubic meter, and the average number of days of heavy pollution and above in each city shall be controlled within 12 days; the average PM2.5 concentration of Fen-Wei Plain shall be controlled within 90 micrograms/cubic meter, and the average number of days of severe pollution and above in each city shall be controlled within 13 days.

Attention: Welcome to China Coal and Coke Industry Conference