Thermal coal

Production area Some mines followed suit after the top miner adjusted down prices for outsourced coal, weakening mine-mouth coal prices. Supply and demand both stayed weak. Small- and medium-sized mines relaxed production to enter Spring Festival holidays, while industrial factories will also start holidays, some utilities are pressing down prices, traders remained on the sidelines.

Northern port Inquiries increased for spot thermal coal, supporting offers of low- and mid-CV coal to stop declining. Some participants said the possibility for price drops is reducing given some pre-holiday demand and relatively high coal cost, and prices may instead hold steady for a period.

Import market Coal import cost further declines along with falling freight rates and strengthening Chinese yuan against US dollar. This may further lower traders' bidding prices in the short run. Indonesian 3,800 Kcal/kg NAR Panamax coal was offered at $90/t FOB.

Coking coal

Coking coal miners came under selling pressures as coke makers' demand waned notably after the latest price cut further squeezed their profit margins, and some miners started cutting offers mildly. Yet most miners held offers steady, given the contracting supply amid miners' rising cautiousness toward the end of this lunar year. Some mines expected offer prices to drop further.

Mongolian coal truck flows to Ganqimaodu stayed high at 857 trucks on January 3, and end buyers' appetite further waned alongside the declined coke prices. Offers for Mongolian 5# raw coal declined to 1,550 yuan/t ex-stock with VAT.

Met coke

Coke market continued softening, as steel mills slowed down purchase as their previous replenishments have built up inventory, and their profitability further weakened amid a seasonal lull in finished steel sales. Despite falling coke profits after the first round of price cut, coking plants maintained stable operations, which will further loosen coke supply in the short run. This, together with weaker cost support, reinforced bearish sentiment among participants.