Dalian coking coal futures slump on weak sentiment, govt control
Chinese metallurgical coal futures fell more than 4% on Thursday, as poor downstream demand impaired market sentiment while the government’s recent pledge on tighter supervision on coal prices is expected to curb any significant gains.
“Domestic coking coal production has been mostly normal, but producers’ confidence weakened,” Huatai Futures said in a note, adding that spot coke prices resumed losses.
Coking plants and steel mills are trying to control their coking coal stockpiles and purchasing on demand, according to the note.
China’s state planner recently pledged to punish price gouging as new coal price caps come into effect. The country’s central bank also said it had allocated 100 billion yuan worth of re-lending to support coal production and storage.
The most-active coking coal futures on the Dalian Commodity Exchange for September delivery ended down 4.2% at 2,544 yuan a tonne.
Coke prices fell 3.6% to 3,281 yuan a tonne.
Benchmark iron ore futures on the Dalian bourse jumped 4% in morning session, but changed direction to close 1.4% lower at 796 yuan a tonne.
Steel prices on the Shanghai Futures Exchange were range-bound, with construction-used rebar for October delivery down 1% at 4,612 yuan a tonne.
Hot-rolled coils declined 0.6% to 4,730 yuan a tonne and stainless steel futures inched 0.1% lower to 18,865 yuan per tonne.
Source: Reuters (Reporting by Min Zhang in Beijing and Enrico Dela Cruz; Editing by Sherry Jacob-Phillips)