Prices of imported Mongolian coking coal in China are expected to continue downward revision given a still bearish sentiment in the downstream coke market, but may decline slower by 100-150 yuan/t in around two weeks before gaining a support, showed the latest Fenwei analysis.
Mongolian 5# raw coal was offered at 2,000-2,100 yuan/t, ex-stock Ganqimaodu in cash this week, down 150-300 yuan/t week on week and falling by 550-550 yuan/t from the peak in April. The purchase price is suggested by Fenwei at 1,900-2,000 yuan/t.
Sxcoal learned some traders at the border crossing started to become reluctant to sell immediately given their growing confidence for the market after previous deep falls and due to the moderate improvement in coking coal demand at China's major production hub Shanxi during May 16-17.
For the supply side, daily clearance of trucks hauling coal from Mongolia to Ganqimaodu border crossing has rebounded to more than 300 trucks since May 10 from around 250 late last week after one COVID-19 case. The daily coal truck clearance stood at 298 trucks averagely each day over May 9-12, falling 44 trucks week on week.
The inflows are expected to further rise if no new case is found among drivers. Mongolia saw a slight rebound in new cases in recent days, but the daily increment had remained below 100, indicating an overall relatively stable situation.
The higher cross-border coal transport has led to higher coal stockpiles at Ganqimaodu border crossing during May 9-12, up by 56,000 tonnes to 660,000 tonnes, showed Fenwei's survey data.
Moreover, the trucking rate of short-haul transportation from Mongolia's Tsagaan Khad to China's Ganqimaodu border crossing rebounded last week after a driver tested positive for the COVID-19, with the prevailing trucking rates for the route at 630-720 yuan/t, rising 100 yuan/t or so from the week prior. However, there are signs of retreating lately as coal prices extended fast decline.
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(Writing by Emma Yang Editing by Harry Huo)
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