Shanxi coke prices rise set off price adjustment storm

After stabilizing in the past three months, the coke enterprises once again prepared to raise prices collectively. The Shanxi Coke Industry Association announced yesterday that local coke prices rose by RMB 60/t in July.

If the coking companies negotiate the price, the price of the secondary metallurgical coke panels for large-scale coke enterprises in Shanxi Province will be raised to 2,000 yuan per ton, and the price of the first-generation metallurgical coke for large coke enterprises will be raised to 2,100 yuan per ton. It is expected that the price of quasi-primary coke arriving in Shanxi Province will reach 2,185 yuan/ton.

For the reasons for the price increase, the joint metal coal coke analyst Mu Wenxin told reporters that the main increase in reserve ratio this year, the coke in the actual settlement process more discount, in addition, this year the main high-quality coking coal, fat coal resources Scarcity, coking coal prices remain high. The Shanxi-based Liulin clean coal, steel mills, and coking companies are rarely able to get the goods; imported coking coal, due to the price hanging upside down, once this year's import volume has been greatly reduced.

On August 1, Shandong Xinwen Mining Bureau announced that it would raise the price of fat coal by RMB 70/ton, and the price of high-quality fertilizer coal after taxation would reach RMB 1,620/ton. According to insiders of the company, the output of the company is currently only half of the actual production capacity, mainly because the resources are relatively tight.

Mu Wenxin said that in the first half of the year, the coking company was facing double squeezes of coking coal and steel, coke prices were at a low level, and coking companies were operating at low profit. In July, some areas showed a weak downward trend.

In August, with the recovery of iron ore and billet prices, the steel market prices rebounded slightly. Since this week, rebar in Shanghai has been raised by 70 yuan to reach 4,800 yuan/tonne; Tangshan billet price has been raised by 60 yuan/tonne; and in Tianjin region, the price has risen by nearly 50 yuan/ton on August 3.

Coke stocks also began to decline. The amount of coke in the port has declined, and the output of Tianjin Port and Lianyungang has dropped by 15,000 tons, while the stock of coke in Rizhao Port is about 145,000 tons.

For this round of price hikes, Mu Wenxin believes that taking into account the overcapacity of the industry and other factors, the increase in coke prices will be easier to accept at 30 yuan per ton, while it will be more difficult to rise above 50 yuan per ton.