Weekly Recap: Chinese met coal and coke market 20-24 Jan

Demand: Demand for coking coal is weak as most downstream buyers have completed their pre-holiday restocking. Steel mills are operating at reduced capacities, leading to muted procurement of raw materials. Similarly, met coke demand remains sluggish as blast furnace utilization rates have not significantly improved, with end-user activity declining ahead of the holiday season.

Supply: Coking coal supply is tightening due to widespread holiday-related shutdowns at mines in Shanxi, Inner Mongolia, and Shaanxi. However, the reduced demand offsets the lower supply levels. In the case of met coke, production remains high as coke plants maintain operations near full capacity, but this has resulted in accumulating inventories, with limited drawdowns from steel mills and traders.

Prices: Coking coal prices are relatively stable but show a weak bias due to low market activity. The Shanxi low-sulfur coking coal index stands at 1,379 RMB/ton, with limited changes. Auction results show some price declines and unsold volumes. Met coke prices have stabilized after multiple rounds of cuts, with the Shanxi index at 1,360 RMB/ton and Rizhao at 1,570 RMB/ton. The market remains cautious, with participants uncertain about post-holiday price recovery.