Tailspin continued unabated in coking coal market. As usual China played the key role in tilting the market sentiments as its appetite ebbed on slow steel demand and plummeting price.

 

Chinese mills are struggling with high inventory levels. In a bid to retrieve the damage production pruning is obvious recourse. Daily crude steel production has declined by 1% from early March to 2.0637 million tonne. Decline in domestic average daily crude steel production was primarily a result of major steelmakers arranging overhauls amid deteriorating profitability caused by high raw material prices and low finished demand.

Coking coal inventory bloated in backlash obviating the need to indulge in buying with liquidation of existing stock gaining primacy.

 

Spot coking coal price levels remained about USD 20 per tonne below the Q2 price of USD 172 per tonne, FOB. Sense of diffidence gripped the miners as they shyied from making any offers rather waiting for bids to decide transaction levels.

 

Situation is unlikely to improve in the short run with Chinese steel prices showing no sign of turnaround