Coke market is lack of effective support, limit production promote price

Recently, the increase and decrease of coke has become the focus of the market. With the previous decrease, the cumulative decrease of coke price in the market has reached 100 CNY/ton. The coking plant is gradually near the production profit and loss line, and the continuous reduction of coke price will face the dilemma of enterprise loss. After the original 11 long holiday, the coking plant is ready to take the lead in opening the price increase. However, affected by the pessimistic expectation of the market, the price of coke does not rise but falls, and the market transaction is still not getting better, which directly hit the enthusiasm of market participants and further pressure on the coke market. The reason why the final price reduction of coke spot is successful is that the demand of downstream steel plants has an impact on the final price reduction, and the coking plant has a weak voice; the second reason is that the price increase is restricted by the social inventory due to its high level of supply. After the 11th long holiday, the steel market, contrary to the expectation of "golden nine silver ten", began to "fall continuously", and the increase of 100 CNY/ton that affected the price of coke failed to land. Data shows that after the festival, the price of Shanghai screw steel dropped from 3800 CNY/ton to 3630 CNY/ton, the lowest price in mid October, with a decrease of 170 CNY/ton. In the case of a sharp drop in the price of screw steel, the demand for steel mills to reduce prices has become very strong.

And from the perspective of the coke inventory level of the steel plant itself, the steel plant is not in a hurry to replenish the storage, thus increasing the discourse power of the steel plant in the process of coke steel game. From the perspective of coke supply level, coking enterprises return to work quickly after the National Day holiday. Due to the fair profits of coking enterprises, coke enterprises have good enthusiasm for production. In this case, coke resources of the whole society begin to flow to the middle and lower reaches of the region. Data shows that by the end of October, the total inventory of coke in the coking plant of the steel plant was 16.9833 million tons, with a weekly to ring ratio increase of 339500 tons. From the perspective of raw material cost, in early October, after the steel plant raised and lowered the cost of coke by 50 CNY/ton, the profit of coke enterprises was seriously compressed, and coke enterprises turned to the raw material end coking coal with loose supply and demand to press the price. All kinds of coking coal fell by 30-60 CNY/ton in the whole October. In addition, the weak international demand for coking coal and the increase of coal arrivals from Australia, coupled with recent port clearance restrictions, led to further accumulation of port coking coal inventory. Therefore, from the perspective of cost, coke still lacks the basis for price increase. However, if there are some positive factors in the coke market, the rate may affect the rebound of coke price. First, the port coke inventory has declined. Data shows that as of November 5, the coke inventory of Shandong two ports was 3.97 million tons, 100000 tons less than that of the national day, and the inventory pressure was relatively eased. Second, due to the limited production of environmental protection, coke enterprises have a substantial capital. In November, the environmental protection work in Shanxi province continued to maintain a rigorous trend, and many inspectors came to the site for supervision. At the same time, coking enterprises are likely to enter the stage of active production restriction, especially when the price of coke falls near the production cost line, it is difficult for them to have the initiative to continue production. On the whole, after nearly a month's decline after the festival, coke is expected to have a rapid rebound, and the main reason lies in its active production restriction and cost support.