(HSV VIETNAM GROUP) – Spot coking coal supply and demand in China remains unstable, with low-sulfur coking coal prices at Anze continuing to fall to 1,300 yuan/ton.
On the supply side, domestic coal mines continued to resume operations and output reached pre-holiday levels; The number of Mongolian coal trucks quickly recovered after the holiday season, but has recently decreased due to the market downturn.
On the demand side, due to losses in the coking process, coking output has decreased slightly, and downstream users have mainly replenished inventories according to demand. On February 25, the 10th reduction in coking coal purchasing prices of major steel mills was implemented. In early March, coal prices fell by 100-230 yuan/ton.
There are signs of improvement in the recovery of domestic production and employment, but the impact of imported coal remains severe. The two sessions shaped the policy to stabilize production and ensure supply remains unchanged. It is expected that spot coking coal prices will bottom in the short term.
For iron ore, as of March 10, inventory of 45 ports was 143,248 million tons, down 2.35 million tons compared to the previous month. Port arrivals continued to be low this week, steel mill deliveries recovered, port discharges increased, and port inventories continued to decrease. The amount of imported ore inventories at steel mills increased by 152,200 tons from the previous month to 91.8241 million tons. The amount of goods drifting at sea from steel mills in Northern China increased, and the amount of inventory accumulated was light.
In the short term, iron ore prices will fluctuate up and down, with internal and external factors affecting the market and industrial factors restraining prices. Specifically, on the demand side, finished product ports are still in a slow recovery phase, the impact of anti-dumping tax on steel plate exports will gradually be considered, steel exports remain stable for two consecutive weeks. Domestic construction projects are gradually being restarted, in which the main problem is still financial resources. Currently, there is no conflict between supply and demand of finished products, and the low inventory model is still maintained. However, if steel mills continue to produce at a faster rate in the future, inventory pressure could increase. As demand recovers slowly, further iron ore supply pressure persists.
Looking at the future market, the positive factors of the domestic macro economy have been exhausted, expectations of price reductions continue, and the macro environment abroad is also relatively complicated. In the short term, with low iron ore arrivals, iron ore prices are expected to be volatile in the short term, with temporary lower support referenced at around 760 Yuan/mt.
Ha Diem HSV