Due to rising coke prices over an extended period, some coking companies have achieved substantial profit growth in the first quarter. Prices still remain at high levels.
Shanxi Coking Group made CNY 451 million ($69.6m) in net profit in Q1, up 350% year-on-year, Kallanish notes. “In the short term, the supply of coke remains tight, and the price of coke shows a stable and strong trend, which has a good support for the company’s performance,” it notes.
Meijin Energy in Shanxi predicts that its net profit in Q1 was CNY 550-750m, returning to profits losses in the same period last year due to higher production and high coke prices.
September 2021 coke futures fell back after touching a high on 8 January, but then increased again rapidly since late March. It closed at CNY 2,683/tonne ($414/t) on Wednesday, approaching this year’s high of CNY 2,759/t.
Recently, inventories at coking companies have declined steadily amid strong demand. Some coking companies have reported bing unable to meet customers’ demand. The high operation rate of steel mills is expected to support the short-term prices of coke.
By Kallanish Team
