Thermal coal

Production area Mine-mouth thermal coal prices were range-bound. Supply tightened slightly approaching the end of the year amid increased production cut and suspension at mines that completed output targets. This, coupled with a mild uptick of demand from traders and downstream users following the resumption of road transportation, attracted more trucks at some mines for loading. A few miners adjusted prices by 10-20 yuan/t based on their inventory levels. However, spot demand remained ordinary as traders sidelined the market amid the downbeat portside market, which still put downside pressure on prices at some mines. Portside transactions and a leading miner's price adjustment for third-party coal would be two factors to keep a tab on.

Northern port The portside market extended the weakness, with traders keeping lowering offer prices. Downstream users continued to drive a hard bargain, resulting in lower transaction levels. Participants held divergent views on the outlook. Some believe the further price decline would be limited by falling portside and power plants' inventories as well as firm cost support, and even foresee a possible rebound in the upcoming month. However, some contend that weak supply and demand, coupled with still high port stocks, led to a lack of confidence in price increases and strengthened willingness to sell.

Import market Offer prices from foreign miners were little changed. Traders' bidding prices to domestic utility tenders for February laycan hovered at a comparatively low level. Based on the bidding price of 530 yuan/t DDP with VAT for imported 3,800 Kcal/kg NAR coal and the current exchange rate, the traders' import cost was $3-4/t higher compared to offers. Traders said if domestic coal prices do not fall significantly, the imported coal prices are also unlikely to fall obviously given their price advantage.

Coking coal

Coking coal supply remained strained in production areas as a whole due to increased production cut and suspensions as well as slow resumption of these accident-involved mines. Demand for coking coal still lacked strength amid weak profit at coking plants and steel mills. Cokemakers shunned purchases of high-priced coal and tended to stay in wait-and-see amid firm coal prices. More miners in wider production areas reported decline in their online auction settlement prices on December 26. Offer prices of some overpriced grades were heard to have fallen by 50-100 yuan/t. However, prices of high-quality backbone grades were relatively firm due to tight supply and smooth sales.

On December 26, China's Ganqimaodu border port let in 1,074 trucks of Mongolian coal. Wait-and-see sentiment remained strong at the port, resulting in continued slack transaction. Traders continued to lower offer prices. Mongolian 5# raw coal under long term contract was offered at 1,600-1,630 yuan/t, ex-stock with VAT.

Met coke

Some coking plants in northern China cut production in response to escalated environmental checks. A few coking plants saw their inventory fall backed by eased logistics constraints, but many plants still reported accumulation of coke stocks. Downstream steelmakers started to cap coke intakes after completing replenishment, which dented dispatches at coking plants. Mills' rigid demand for coke declined amid loss-making status, maintenance and lower molten iron production. While overall coke supply and demand remained weak, supply slightly loosened.