According to statistics of Qingdao customs that coke exports in the first four months at the port remained at 20,000 tonnes worth USD 6.27 million plunging by 78.9%YoY and 83%YoY respectively. The average export price remained at USD 314.3 per tonne declining by 19.3%. In this January coke exports stayed at 4,000 tonnes and in February it rebounded a bit. However, it must be noted that coke exports had fallen in stagnation in March and April.
India remained China largest export market, which got 16,000 tonnes dropping 49.3% and it took up 77.7% of the total export volume of Qingdao port. Korea and Japan got 3,000 tonnes and 1,000 tonnes dropping 64.4% and 94.1% respectively.
The reason for the drop rests with two facts.
1. Global steel demand has been gloomy affected by the economic recession, and steel mills all started to lay up steel capacities, which directly led to decline in coke demand.
2. In order to strike a balance, domestic coke enterprises all cut their production and lower their prices. As coke production comes down, exports drop reasonably. Plus the 40% coke export tariff exposed from last August coke enterprises were extraordinarily reluctant to export coke.
Domestically, China's coke enterprises have been squeezed by weak demand and high coking coal price, making them in a rather grim situation. In order to reduce loss, coking enterprises are enhancing their effort to both lower price and cut production. In April Shanxi, Shandong and Hebei, the three major coke producing provinces in China laid up as many as 50% capacities and Shanxi Coking Industry Alliance ordered to keep the production cut-degree at 60% to 70% and preferably to halt all production temporarily. Coke referenced price was lowered by CNY 100 per tonne after it was pushed down by CNY 150 per tonne in March and then it stayed at CNY 1,600 per tonne.
Source : Mysteel.net