| News & Trends | ||
| Update on Chinese coke scenario - 18 Nov, 2008 | ||
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It is reported that Chinese coking industry has suffered overall losses upon dwindling demand and slumping prices. Insiders pointed out that enterprises should grasp chances behind the downturn and make effort in structural adjustment and resource integration with a view to upgrading the competitiveness for the next round of market rally. An official with Shanxi Coking Industry Association said that the coke market has experienced dramatic up and down during the January to October 2007. Coke FOV price at the beginning of this year was CNY 1780 per tonne, soared CNY 1200 to CNY 2980 per tonne in July, and then tumbled to the current CNY 1700 per tonnes just within three January to October.” An expert with the Association analyzed that the tight supply and flying prices of coal resources, coupled with levy of fund for coal industry sustainable development and charges for disposing pollutants would blame for the sharp price rise of coke in the earlier period. But the tumble in the following months would be explained by the August quiet domestic market and increasing stockpiles at ports owing to the up corrected duty, and then the slumping demand in September and October. Mr Zhang Gangfeng, secretary general with the Association said that the coking industry in Shanxi province has born losses of CNY 3 billion in September and October, with some large enterprises losing CNY 100 million just within one month. Against the situation, the authority lately appealed to the coking enterprises for production cut to save prices, suggesting the highest range at 70% and the guiding price at CNY 1800 per tonnes. Meanwhile, some enterprises have started chopping prices to withdraw currency and later plunged into a price battle. Some offers of coke are as low as less than CNY 1000 per tonnes. However, the crux of the matter is the slack demand. Sales market appears hard to bloom even by means of price discount. Some enterprises have suspended production currently. Mr Yu Changbin, researcher with China Enterprise Development and Research Centre said that the industry was weighed on by the waving market, which, on the other hand, contained opportunities within it. He said that some coke enterprises, if they could, should try to change or adjust production under such circumstances, while the whole industry can improve structure and integrate resources to enhance the industrial and corporate competitiveness. Mr Zhang said that "It can be optimistic to expect that the coke market is likely to recover in the next February following the definite steel industry rally with the government measures to expand domestic demand by means such as large scale infrastructure building." (Source from MySteel.net) | ||
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