Production area Thermal coal prices picked up in Ordos of Inner Mongolia, given tight supply alongside more mines' production halt due to lack of coal sales quotas. Shortage was also seen in Yulin of Shaanxi as a few coal mines suspended operation for changing working faces. Production regions embraced robust demand from local coking and coal chemical plants, power plants and rail stations. Supply gap is expected to continue to support coal prices in the short run.
Northern port Sentiment improved at portside market. A handful of end users accepted the high prices pressured by urgent restocking demand, while most downstream buyers were still in the sidelines. Traders had intention to sell goods as long as trades are profitable.
Import market Sentiment in import market was also heated up, and inquiries from downstream buyers increased. Some coal miners in Indonesia declared force majeure, impacted by recent rainstorm and rampant COVID-19 pandemic, which may weigh on coal-loading in the country. Russia was under the same situation. Prices of seaborne import cargoes rose again. Indonesian 3,800 Kcal/kg NAR thermal coal were offered at $72-73/t FOB, on Panamax basis.
Capacity utilization dropped 1.1 percentage points week on week to 96.58% at coking coal mines surveyed by Sxcoal, constrained by geological conditions and safety inspections. This reflected supply shortage of coking coal. Coking coal prices went up further supported by strong downstream demand.
Ganqimaodu border crossing saw 132 coal-laden trucks clear customs on July 29, but cargoes were still scarce. Mongolian #5 raw coking coal was offered at 1,650-1,680/t, ex-stock Ganqimaodu with VAT.
With coke price rise accepted by more steelmakers, sentiment was heated up again. Coke demand was robust from steel mills and speculative buying was also active. Moreover, coke makers held off sales in anticipation of further coke price rises. The improved supply-demand fundamentals and high prices of coking coal will continue to support coke prices.
(Writing by Lilya Li Editing by Tammy Yang)
For any questions, please contact us by email@example.com or +86-351-7219322.