End-of-Day Market Summary PHCC – July 21, 2025

End-of-Day Market Summary – July 21, 2025

Tone: DCE Breaks RMB 1000, But Seaborne PHCC Still Faces Headwinds

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🔹 DCE Sep Surges Past RMB 1000

Chinese Sep DCE futures broke through RMB 1000, reflecting bullish macro sentiment and firm spot physical prices in the domestic market.

Expectations are forming around Q3 LTC price upward revision, but actual adjustment remains highly unlikely.

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🔹 Why Q3 LTC Price Hike Is Unlikely

The domestic spot vs LTC price spread is only ~RMB 50–60, insufficient to trigger an official LTC revision.

While sentiment is improving, it hasn’t translated into structural or contractual price shifts.

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🔹 Chinese Tier 1 Seaborne Demand Still Absent

Despite stronger domestic coal and paper markets, no firm bids from China for seaborne Tier 1 PHCC cargoes.

Illawarra bids reportedly at $180 FOB once again makes Chinese buying elusive, unless China catches up with another 15 dollars.

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🔹 FOB Market Lacks Fundamental Support Despite Arbitrage Logic

At first glance, $180 FOB makes sense against:

TSI Aug at $185

TSI Sep at $190

However, key physical markets remain weak:

Indian steel demand subdued

European steel complex still under pressure

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🔹 Resell Risk Looms Above $180 FOB

Traders and miners remain cautious as any fixed price trades above $180 FOB could again trigger resell pressure, as seen in past weeks.

The lack of follow-through demand despite bullish DCE signals a market that is still technically buoyant but fundamentally fragile.

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🧠 Insight:

FOB PHCC price strength is currently paper-driven, not demand-led.

The disconnect between strong Chinese futures and weak global steel fundamentals is likely to limit sustained upside in FOB trades.

Monitor for:

Real buying from non-LTC Chinese mills

Signs of resell offers emerging above $180 FOB