Downward pressure intensified in China's metallurgical coke market, as participants widely anticipated the implementation of a fourth round of price cuts in the coming days, and expectations for a fifth decline also emerged amid cool sentiment.

On December 29, major steel mills in Hebei and Tianjin proposed to trim coke purchase prices by 50-55 yuan/t, effective January 1, 2026. This latest move underscores the persistent imbalance between supply and demand and the increasingly strained profitability outlook for coke producers.

Notably, some coking plants in northwestern China even overshot the decline in a bid to expedite shipments. Domestic met coke and coking coal futures markets remained largely rangebound, offering little support to spot prices or market sentiment.

Coke supply held largely stable despite thinner margins after three rounds of price declines. Most coking plants kept their previous production levels, with no widespread output cuts reported. Several producers completed equipment maintenance and resumed normal operations.

However, a growing number of coke enterprises risked slipping into negative territory. "If the fourth price cut is implemented, our top-charging operations will suffer losses of tens of yuan/t," said a Shanxi-based coke producer source.

Coking coal prices continued their downward trajectory, albeit at a slower pace than in previous weeks. The softening coal market provided some relief to coking plants, yet undermined the cost support to coke prices at the same time.

Participants suggested that January's coking coal market direction will be pivotal. A sustained decline could ease pressure on coke makers, while any rebound may force them to accelerate production curbs to mitigate losses.

Steelmakers, on the other hand, showed limited appetite for aggressive production increases despite some improvement in margins following the consecutive coke price drops. The seasonal lull in steel consumption continued to weigh heavily, and finished steel prices remained weak, with molten iron output falling to relatively low levels.

One steelmaker source based in Shandong reported that they were controlling coke inventories. "Coke prices may stabilize temporarily after the fourth price cut, but a fifth round remains possible amid ongoing sluggish demand for finished steel products," he added.

Several mills still underwent blast furnace maintenance, with no firm timeline for resumption. "We're self-sufficient in coke at present and have suspended external purchases," said a steelmaker source in northeastern China.

Another Shanxi-based coke maker source emphasized that steel mills did not face raw material supply shortages and that further coke price cuts may be unavoidable in this context.

Still, a few voices suggested the market may be approaching a bottom, at least in the short term. "Coke pricing might be close to the floor after four rounds of cuts," a third Shanxi-based coke producer source noted.

If mills or traders decide to replenish inventories aggressively in January, it could temporarily stabilize prices, while a strong rebound appears unlikely amid unbalanced and weak market fundamentals.