Thermal Coal

Production area Mine-mouth thermal coal prices dropped 10-20 yuan/t at some mines during the National Day holiday, impacted by reduced coal consumption at power plants along with falling temperatures. Downstream buyers largely finished their periodic restocking, depressing spot transactions. Slow offtakes forced some miners to lower offer prices. Miners noted thermal coal prices may further drop given thickened wait-and-see sentiment.

Northern port Portside transactions were quiet, with offer prices keeping stable from preholiday levels. Port-bound coal shipments via railway were steady in recent days, but post-holiday stocks at northern ports saw modest declines. Participants were divided on the future market outlook. Some anticipated demand to further diminish in the short run, but it remains to be seen whether there will be a surge in demand from non-power sectors under favorable macroeconomic policies. Some traders were in a wait-and-see amid a lack of clear direction for post-holiday demand.

Import market The seaborne import market stayed steady. Power utilities floated more tenders before the National Day holiday. Post-holiday prices remained largely stable, and overseas offer prices remained firm. Traders may still face higher prices for low-CV coal than bid prices to utility tenders, adding to their bearish sentiment. Bidding prices to 3,800 Kcal/kg NAR coal tender received by one utility in southern China stood at 490-500 yuan/t, DDP with VAT.

Coking coal

The overall coking coal supply slightly tightened as some mines in Shanxi temporarily suspended production during the National Day holiday. Driven by frequent macroeconomic positives, end users and traders made purchases actively, contributing to smooth offtakes and 50-100 yuan/t price rises of certain coking coal grades compared to preholiday levels.

Major Sino-Mongolian border crossings were closed for seven days over October 1-7, leading to significant stock depletion at supervision warehouses at China's Ganqimaodu border port. Optimistic traders considerably raised offer prices for Mongolian coking coal backed by sustained coke price hikes. Prevailing offers for Mongolian 5# raw coal came in at 1,300 yuan/t, ex-stock Ganqimaodu with VAT, with some even above this level.

Met coke

The fourth coke price hike swiftly materialized during the holiday. Major steelmakers in Hebei have already accepted the fifth rise, taking cumulative growth to 250-275 yuan/t since late September. Market sentiment improved and finished steel prices rapidly climbed buoyed by positive macroeconomic measures. Steel mills enjoyed continuously increased profits, driving up coke prices. Most coking plants have turned from losses to profits due to lagged feed coal price rises. A few cokemakers even lifted output. Coke prices are likely to rise higher in the near term amid increases in both supply and demand and a positive market outlook.