In mid-July, the price of secondary coke in China dropped 35.2 CNY/ton

According to the latest data released by the National Bureau of Statistics on July 24, in mid-July, the price of coke (secondary coke) in China was 1744.3 CNY/ton, down 35.2 CNY/ton from the previous period, a decline of 2%, a decrease of 4.9 percentage points from the previous period.

In mid-July, most of the steelmakers in Hebei area were affected by environmental protection, and the start-up of blast furnaces in Handan area continued to decline, the demand for coke was weakened, and the speed of vehicles entering and unloading coke was intentionally controlled. Coke stocks in steel mills continued to maintain high and medium levels, purchasing more on demand, and overall coke demand declined. Although the environmental protection inspection in Shanxi is normalized, the mood of environmental protection management is high and the expectation of production restriction is strong, it needs to wait for specific policies to be introduced. However, the start-up of coke enterprises is still high and stable. Some regional coke enterprises have slightly increased production due to the weakening of environmental protection, and the overall supply side is basically guaranteed. Coke prices continued to fall under the condition of loose supply, but the decline has narrowed. 

With the decline of coke enterprises'profits and the increase of trader purchasing, the phenomenon of no inventory in coke enterprises of origin has increased gradually, the sales situation of coke enterprises has improved, the market expectations have strengthened, and some coke enterprises have begun to raise coke prices. The coke price of 11 coke enterprises in Fenwei Energy Co., Ltd. and Xuzhou District increased by 100 CNY/ton. The coke price of the others sent to a large steel enterprise in Hebei Province was temporarily stable.

Coke enterprises started construction basically stable, Shanxi 100-day special inspection continued, coke enterprises in Linyi area of Shandong Province gradually implemented smoothing furnace, some coke enterprises in Xuzhou of Jiangsu Province continued to limit production due to equipment problems, and coke enterprises in the rest of the region had stable production. Overall, coke enterprises started construction did not show a significant decline.

Coke enterprises keep their inventory low, but the recent sales situation in Northwest China has been slightly weakened. At present, the mainstream steelmakers in the northern region have implemented 100 yuan per ton increase. At this stage, the inventory of coke enterprises is running at a low level and orders are sufficient. It is known that some orders of coke enterprises have reached mid-August, which supports the coke market to a certain extent.

However, although the steel mill gradually implemented the coke price increase, most of the current factory inventory continued to operate on the high side, taking into account the continuous increase in port inventory and the port authority to increase the deposit fee, it may become a late market risk point.

Follow-up will continue to focus on whether Tangshan Regional Steel Works will resume production in August and its environmental protection effectiveness during the Second Youth Congress of Shanxi Province.  Fenwei Coke Index shows that as of July 23, the Shanxi Luliang Quasi-first-grade Metallurgical Coke Index was 1800 CNY/ton, with a rise of 40 CNY/ton and a decrease of 100 CNY/ton per month; the Hebei Tangshan Quasi-first-grade Metallurgical Coke Index was 2010 CNY/ton, with a rise of 100 CNY/ton and a decrease of 100 CNY/ton per month; and the Rizhao Port Quasi-first-grade Metallurgical Coke Index 202 CNY/ton.