Production area Thermal coal supply remained tight, as coal production was strictly in line with the approved capacity and some coal mines in Ordos halted production for exhaustion of coal sales quotas toward the end of the month. Downstream buyers were active in inquiry and buying, and t more trucks for coal-loading. Coal prices already exceeded previous highs at some coal mines.
Northern port Prices at portside market were largely stable at high levels. Traders held that coal prices were unlikely to have a large fall cushioned by present tight supply-demand fundamentals, and may have some downward corrections in the near future with retreat of peak summer demand and production increase. Some traders have intention to sell their cargoes at present prices, while others were still waiting for higher prices.
Import market Import market remained firm. Limited import cargoes were offered at high prices, and transactions were inactive. Utilities' demand may remain robust given high power load, which may continue to support coal prices. Indonesian 3,800 Kcal/kg NAR thermal coal were offered at $70/t FOB, on Spuramax basis.
Coking coal supply was even tighter. Capacity utilization declined 2.01 percentage points week on week to 97.67% at coking coal mines surveyed by Sxcoal late this week, impacted by the recent rainstorm and safety inspections. Some coking coal miners shifted to ensure thermal coal supply as some coking coal grades they produce could also be used for power generation. This, coupled with transportation disruption, caused the rainstorm further constrained coal supply. Coking coal prices posted strong increase, and auction prices gained 30-130 yuan/t at some large coal mines in Shanxi.
Ganqimaodu saw 143 coal-laden trucks clear customs on July 22, indicating steady operation resumption of the border crossing. Nevertheless, available resources were still scarce.
Coke supply was tightened by environmental inspections, energy consumption restriction and supply shortage of coking coal. Coke arrivals at steel mills were impacted as rainstorm disrupted transport. Stocks at portside market were at low levels, signaling improved demand. Steel mills showed weakened intention in beating down coke prices, given improved margin of steel products and high costs of feed coal. Coke prices were still supported by high costs.
(Writing by Lilya Li Editing by Tammy Yang)
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