August 25 news
I. Price Trends
According to the commodity market analysis system: On August 25, 2026, the average price of quasi-first grade metallurgical coke was 1868 CNY/ton. After three rounds of price reductions in early August, which cumulatively decreased by 150-165 CNY/ton, the first round of price increases was implemented on August 24 (wet quenching +50, dry quenching +55 CNY/ton). On August 25, mainstream steel mills in Tangshan, Xingtai, and other areas confirmed the second round of price increases, with wet quenching +100 and dry quenching +110 CNY/ton, effective at midnight on August 26. The two rounds of cumulative price increases amounted to 150-165 CNY/ton, offsetting the previous price decreases.
2. Market Analysis
Market Trading: Coking coal supply is tight: Some mines in Linfen and Jinzhong, Shanxi have resumed production after passing inspections, but “resumption without full capacity,” with occasional new suspensions in Lüliang. Regular safety inspections and the scarcity of low-sulfur coking coal/skinny coking coal resources have led to no unsold lots and high premiums in online auctions. Mongolian coal imports have been disrupted and declined. The average price of S<1 coking coal in Lüliang, Shanxi, is 2200 CNY/ton, up 325 CNY/ton (+17.33%) month-over-month. Coke producers' losses have widened: The first round of price increases has been offset by rising coal prices. The average profit per ton of coke for independent coke producers in China is -149 CNY/ton (with some samples at -203 CNY/ton). Top-charging coke production in Shanxi has dropped to 60-70% of capacity, while ramming coke production is around 80%.
Market: Pig iron production at high levels has slightly decreased: the daily average pig iron output of 247 steel mills in China is 2.3768 million tons (down 0.0052 million tons week-on-week), with a blast furnace operating rate of 82.8% and a capacity utilization rate of 89.25%; the daily coke production from steel mills' own coking plants is 0.4732 million tons, remaining stable. Steel mill inventories are tight: the coke inventory of 247 steel mills in China is 6.405 million tons (down 0.115 million tons week-on-week), with the available days dropping to 11.27 days (12.95 days at the end of May). There is an increase in expedited deliveries, but procurement is mainly based on demand. Profitability of steel mills is under pressure: the profit margin of steel mills is only 32.47% (down 1.3 percentage points week-on-week), with over 60% of steel mills incurring losses. The acceptance of continuous price increases is driven by the fear of supply disruption rather than profit expansion.
Steel Demand: Pig iron production at a high level slightly decreased: 247 steel mills in China have an average daily pig iron output of 2.3768 million tons (down 0.52 million tons week-on-week), with blast furnace operation at 82.8% and capacity utilization rate at 89.25%. The daily coke production by the steel mills' own coking plants is 0.4732 million tons, remaining stable. Steel mill inventories are tight: 247 steel mills in China have a total coke inventory of 6.405 million tons (down 0.115 million tons week-on-week), with the available days dropping to 11.27 days (12.95 days at the end of May). There is an increase in expedited shipments, but purchases are mainly based on demand. Steel mill profitability is under pressure: only 32.47% of steel mills are profitable (down 1.3 percentage points week-on-week), with over 60% of steel mills incurring losses. The acceptance of continuous price increases is driven by the fear of supply disruption rather than profit expansion.
3. Future Market Forecast
Coke analysts believe: the hard constraint on coking coal supply is difficult to resolve + coke enterprises are limiting production due to losses + steel mills have low inventory and rigid demand. The first round has already been implemented, and the probability of the second round being implemented on August 26 is high. The market expects around 3 rounds of price increases. Constraints include a slight decrease in pig iron output and a steel mill profitability rate of around 32%. If coke prices continue to rise after the second round, steel mills may increase blast furnace maintenance and reduce pig iron output, increasing the risk of negative feedback.
