the price of secondary coke continued to rise by a large margin of 87 CNY/ton

According to the latest data released by the National Bureau of Statistics on May 24, the price of coke (secondary coke) in China was 1935.8 CNY/ton in mid-May, up 87 CNY/ton from the previous period, up 4.7%, and the increase was further expanded, but the increase was narrowed down by 0.1 percentage points compared with the first ten days of May.

In the expectation of Shanxi coking industry's vigorous integration and capacity reduction, domestic coke prices have been rising strongly in recent years. At present, the third round of domestic coke market rise has basically completed its landing, with local markets rising by about 100 CNY/ton and three rounds of cumulative increase by about 300 CNY/ton.

On May 6, the Ministry of Ecology and Environment issued a paper entitled "Looking Back" and Special Supervision Situation Feedback from the Second Central Eco-environmental Protection Supervision Group to Shanxi Province. The supervisory group directly pointed out that Shanxi coking capacity expansion impulse is still strong, the coking capacity "more adjustments more", at the same time, Shanxi optimization of industrial layout requirements are all in vain, industrial adjustment is obviously inadequate, in addition, the pollution emission problem is very prominent, pollution control refuge is easy.

In this regard, the Shanxi Development and Reform Commission, the Provincial Office of Industry and Information Technology, the Provincial Department of Ecology and Environment, Taiyuan City, Changzhi City and Jinzhong City held meetings and wrote that they would make every effort to promote the rectification and accelerate the formulation of specific rectification plans.

According to the analysis, Shanxi coking industry is expected to usher in a new round of reform with the aid of this environmental protection supervision. The strength and influence of this inspection increased significantly the previous time, especially for the coking industry, the inspection team directly named its capacity expansion and pollution exceeding the standard. Since this year, the main contradiction between coke supply and demand has focused on the long-term easing situation at the supply side. Based on the above analysis, whether from the industry itself or from the level of Shanxi government, the effect of this environmental supervision and rectification will probably be stronger than before, and this year coincides with the 70th anniversary of the founding of the People's Republic of China, and environmental issues have been hotly discussed during the two sessions. The plan of this round of supervision and rectification will be announced at the end of this month or the middle of next month, when the coke supply will be suppressed or the inflection point of supply will appear.

On the demand side, Tangshan's output limit in the second and third quarter is less than the document's expectation, and a number of capacity replacement steel plants in the north have been put into operation gradually in the near future. In the short term, coke demand may fluctuate, but the overall trend will be stable. On the basis of the implementation of rectification measures in Shanxi coking industry, the price center of medium and long-term coke may still move up. Analysts in the industry pointed out that the reason why coke prices could rise continuously for three rounds was the low inventory of coking plants on the one hand, and the strong purchasing enthusiasm of steel plants on the other. Although the market has been concerned about the production restriction of Tangshan iron and steel enterprises, the actual implementation is not as strong as expected. At present, coke stocks in steel plants are mostly at medium level, and some steel plants have low stocks. The reason for accepting the increase in coke prices is because of the demand for replenishment.

Under the influence of factors such as replenishment of steel plant, low inventory level of coke enterprises and environmental protection and production restriction, the overall mentality of the industry is optimistic. It is expected that the domestic coke spot market will be stable and strong in the near future.