MANILA: Chinese metallurgical or coking coal futures soared more than 7% on Thursday to hit a two-week high as supply worries resurfaced, pushing prices of steelmaking ingredient coke also higher.
The most-traded January coking coal on China’s Dalian Commodity Exchange rose as much as 7.7% to 3,044 yuan ($470.62) a tonne, its strongest since Sept. 10.
Coke advanced 5.7% to 3,536 yuan a tonne, its highest since Sept. 13.
Coking coal and its processed form – coke – have emerged as this year’s top gainers in China’s ferrous metal complex, with coking coal having risen more than 80%.
In the current quarter, Dalian coking coal has gained the most since 2016 as top steel producer China struggles with tight supply following a ban on Australian coal, disruptions in Mongolian shipments and weak domestic output due to mine safety restrictions.
“The coking industry in Shandong, Shanxi and parts of Hebei is affected by factors such as environmental protection and production restrictions,” Sinosteel Futures analysts said in a note, referring to China’s top steel-producing provinces. Dalian’s January iron ore soared 6.8% to its loftiest since Sept. 16.