Chinese Coking Coal Rebounds on Supply Worries
Chinese Coking Coal Prices Rebound on Supply Concerns
China's coking coal prices rebounded on Thursday, aided by resurfacing concerns about contracted supply after several mines halted production amid stringent safety inspections following a deadly mine accident in coal-rich Shanxi province.
Mine Accident and Supply Disruptions
China's State Council established an investigation team for the Liushenyu coal mine accident in northern Shanxi that killed 82 people. According to a survey by consultancy Mysteel, a total of 113 coal mines in Shanxi, with a combined production capacity of 125 million metric tons, remain suspended. A survey by Steelhome showed that around 452,000 tons of raw coal have been reduced each day after the accident.
Price Movements
The most-traded coking coal contract on the Dalian Commodity Exchange (DCE) advanced 1.3% to 1,284 yuan per ton. The most active DCE coke contract rose 1.66% to 1,893 yuan a ton. Analysts noted that coking coal supply has contracted prominently, supporting prices.
Other Commodities
Iron ore lost ground with the most active DCE contract dipping 0.13% to 780 yuan a ton, while the benchmark June iron ore on the Singapore Exchange fell 0.71% to $104.45 a ton. Analysts at JP Morgan lifted the long-term iron ore price forecast to $90 a ton from $80 previously. Steel benchmarks on the Shanghai Futures Exchange were mixed.
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