Breaking coal & coke market update! Tight coking coal supply and limited Mongolian imports push coke

Breaking coal & coke market update! Tight coking coal supply and limited Mongolian imports push coke prices higher — we expect big additional price surges ahead. Reach out for latest coke quotation & cargo supply info.

# Metallurgical Coke Market Analysis: Sharp Further Price Hikes Expected in Short Term

Since August 2026, China’s coking coal and metallurgical coke markets have entered a powerful upward cycle. Driven by severe domestic coking coal supply shrinkage, plummeted Mongolian coal import volumes, sustained steel production rigid demand and full-industry low inventory structure, coke prices have staged multiple rounds of collective hikes. We forecast metallurgical coke will witness **substantial additional price surges** in the near term, with tight fundamental balance set to persist through September 2026.

## Core Drivers of the Current Price Rally

### 1. Acute Domestic Coking Coal Supply Shortage (Fundamental Core Support)

A fatal mine safety accident hit Shanxi Province in late May 2026, triggering province-wide rigorous safety rectification across all coking coal mines, followed by nationwide intensified inspections.

- Major coking coal mines in Shanxi, the top domestic producing base, were forced to cut output or suspend operations; the overall capacity utilization rate of coking coal mines only stood at 68.1% recently, far below the normal operating level.

- Cumulative refined coking coal output from May to July dropped sharply year-on-year, with mine-side refined coal inventories sliding to a 5-year seasonal low, leaving almost no flexible supply buffer for downstream buyers.

- Domestic coal auctions maintain 100% transaction rate with frequent high premiums; end-users rush to secure spot cargoes, continuously lifting spot coking coal prices, with high-quality primary coking coal rising by 500–600 RMB/MT within August alone.

### 2. Mongolian Coking Coal Imports Plunge, Marginal Supply Supplement Collapses

Mongolia is China’s largest supplementary source of imported coking coal, and Ganqimaodu Port serves as the critical customs clearance gateway for Mongolian coal shipments.

- Starting mid-August, environmental supervision tightened drastically at Ganqimaodu Port, daily clearance truck volumes crashed from over 1,300 units down to merely 500–600 units per day.

- Stockpiles inside port supervision zones depleted rapidly within three weeks, with tradable spot Mongolian coal resources nearly exhausted; Mongolian raw coal prices surged by over 500 RMB/MT in August, pulling up the entire coking coal price complex across domestic markets.

- At present, port clearance efficiency shows no obvious sign of recovery, and the gap between domestic coking coal supply and demand cannot be filled by imports in the short run.

### 3. Coking Plants Suffer Severe Losses, Forced to Restrict Output

Coking coal accounts for more than 70% of total coke production cost; the skyrocketing raw coal price completely eroded coking enterprises’ profit margins.

- Despite three rounds of coke price hikes implemented in August (cumulative increase of 250–275 RMB/MT), the amplitude far failed to offset the cost growth of coking coal, pushing most independent coking factories into deep losses.

- To control losses, coking plants actively cut operating loads, pushing the national average capacity utilization rate of coking enterprises down to roughly 64.5%. Reduced coke output further tightens coke market supply, creating a self-reinforcing upward loop for coke prices.

### 4. Steel Rigid Demand Remains Stable, Limited Downside for Blast Furnace Iron Output

Though most steel mills operate under thin profit pressure, downstream steel consumption is entering the traditional peak demand season starting September:

- Steel product inventories are drawing down rapidly, steel spot prices keep climbing, and blast furnace iron output only edged slightly lower without large-scale full-furnace maintenance or production cuts by major steelworks.

- The whole industrial chain maintains ultra-low inventory levels: coking plant stockpiles, steel mill coke raw material inventories and port transit inventories are all at yearly lows. Once supply tightens further, steel mills will launch passive restocking, magnifying price upward momentum instantly

## Market Outlook: Significant Further Coke Price Rises Are Highly Likely

We hold a strong bullish view on metallurgical coke prices in the coming weeks, and multiple new rounds of large-scale price hikes for coke will materialize, based on three unshaken logics:

1. **Raw material cost support remains rigid**: Shanxi mine safety inspections will not be relaxed in September, and Mongolian port clearance volumes cannot recover rapidly. Coking coal prices will stay firm at high levels, continuously pushing coking factories to launch new coke price adjustment notices. The fourth round of coke price hikes has already been initiated by mainstream coking producers as of early September.

2. **Coke supply will keep contracting**: Persistent losses will force more coking enterprises to lower operating rates, limiting total coke supply growth and widening the supply-demand gap.

3. **Peak-season steel demand props up coke purchasing**: September’s construction and manufacturing steel demand recovery will sustain steel mills’ stable blast furnace operation rates, forming solid demand support for metallurgical coke.

### Key Risk Threshold to Monitor

The only two factors that could reverse the bullish trend in the medium term are:

1. A sharp recovery of daily Mongolian coal clearance volumes at Ganqimaodu Port to ease domestic coking coal shortage;

2. Massive blast furnace shutdowns across steel plants leading to a steep slump in iron output and coke consumption.

Neither condition is expected to occur within September, so the upward trend of coke prices will remain dominant in the short run.

## Business Note for Global Buyers

We supply various grades of Chinese metallurgical coke, foundry coke and carbon raiser to steel, casting and alloy manufacturers worldwide. Should you require real-time spot price updates, cargo availability or technical inspection reports, feel free to send us an inquiry anytime.

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