Thermal Coal

Production area Thermal coal prices remained broadly stable in key mining hubs. Some small- and medium-sized mines halted or cut production after completing their annual targets, tightening overall supply. Restocking occurred in the chemical and residential sectors by month-end, while railway station-based traders also replenished inventories. As a result, a few mines reported a slight uptick in sales, tentatively raising prices. However, participants largely stayed on the sidelines due to falling portside prices and a leading miner's cut in purchase prices for third-party coal, leaving tepid demand and fragile price support.

Northern Port Sentiment improved slightly in the portside market. Declines in sellers' offers narrowed, while buyers continued to push for discounts amid weak demand, leading to limited transactions. As downstream demand picked up, seller turned reluctant to sell at low prices, narrowing price drops and potentially stabilizing near-term prices. Yet, prices are expected to fall further due to elevated inventories at northern ports and subdued end-user demand.

Import Market Firm offers from overseas mines and continued release of tenders from domestic utilities prompted some traders to hold or even slightly raise bidding prices. Falling seaborne freight rates also lent some leeway for FOB prices. However, with power loads still low and inventories remaining elevated, power plants were able to meet their needs through scattered, need-based restocking. Prices are expected to decline further amid sluggish fundamentals.

Coking Coal

Production at 138 coking coal enterprises surveyed by Sxcoal slid for four consecutive weeks, with further tightening expected as the New Year's Day approaches. Coke prices are likely to face further cut, creating a cautious sentiment across both the coking coal and coke markets. This, coupled with marginal profit for cokemakers, limited coking coal procurement. Mines largely reported unsmooth sales and weak activity in online auctions. Prices remained rangebound, with certain backbone grades, particularly those sold as pre-orders, holding stable due to relatively tight prompt availability.

Both offers and counteroffers for imported seaborne coal remained sparse during the Christmas period. Prices for Australian February-delivery cargoes stayed relatively stable. One Australian miner sold PMV coking coal through a tender at about $218-219/t FOB. That translated to about 1,874 yuan/t ex-stock north China port with VAT, still significantly higher than domestic equivalents.

Met Coke

With raw material costs retreating, steelmakers returned to profitability, but molten iron output remained low. Steel mills were cautious in purchasing due to the sluggish market, with most buying on a need-to basis. This led to slight stock buildups at coking plants, though overall inventories remained relatively low. Cokemakers were mostly operating at break-even point following three rounds of coke price cut, with some even in losses. Despite this, most plants sustained normal operations, keeping supply relatively stable. Coke prices are expected to continue falling due to a lack of upward momentum.