China coke price climbs, downtrend remains

Coke price climbed in some areas of China recently, but the downturn in domestic market is hard to reverse in a short term, due to sluggish demand from steel mills and high cost of coking coal.



In late November, the coke price in Handan of Hebei edged up 50 yuan/t.



The slightly rebound of coke price is attributed to price rise in some steel products and falling raw material stock as a result of the government’s stimulus package for infrastructure construction, analysts said.



"It is only a margin rise from the bottom, since part of the small steel mills resumed and began to purchase", said Ma Xiaoguang, an industry analyst.



Coke producers in China's eastern areas are also planning to adjust up their prices 200-300 yuan/t in December. In addition, many steel mills started to purchase coke as stock waned.



Sources said some coking plants in Wuxi and Shanghai planned to hike coke price by 250 yuan/t to 1450 yuan/t from 1200 yuan/t.



But, the price of coking coal, the main material for coke-making, remains high. Coke makers will suffer more losses if they increase production, only if steel mills resume production greatly.



Currently, the price of primary coking coal stands at 1200-1400 yuan/t, closing to the price level of coke.