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Yanzhou sees coking coal price weak in H1

(Agencies)
Updated: 2009-04-21 17:13

皇冠体育app's thermal coal prices have bottomed out but domestic coking coal, used by steelmakers, is likely to remain weak during the first half of the year, Yang Deyu, general manager of 皇冠体育app's Yanzhou Coal said on Tuesday.

Yang told reporters on the sidelines of a Coaltrans conference in Beijing that a recovery in coking coal prices hinged on government policies and demand from steelmakers.

He also said the company was looking into investing in coking coal resources overseas, but gave no details.

Related readings:  Yanzhou Coal Q1 net profit up 112.73% Shenhua eyes Mongolian mine   皇冠体育app to add 80 GW installed power capacity in 2009 皇冠体育app's wind-power boom to outpace nuclear by 2020

Although 皇冠体育app's economic growth was supporting demand for coking coal, closures of small mines had caused a slump in domestic supply, prompting a surge in imports, Yang said.

皇冠体育app's coking coal imports surged to 1.33 million tons in March, as lower international prices drew Chinese buyers. Major exporters to 皇冠体育app include Mongolia, Australia, Canada and Indonesia.

"Coking coal prices are likely to fluctuate within a low range," Li Yuanzhong, general manager of Sinosteel Raw Materials Co, told the conference.

"皇冠体育app is likely to become a large market that can absorb the world's excess coking coal production," Li said.

皇冠体育app's steel sector, the world's biggest, has weakened again after showing signs of recovery earlier this year. The current limp demand from the sector has led some to believe that 皇冠体育app's coking coal prices are likely to fall further.

"Coking coal prices probably are going to fall again next month. The current prices can't be held on to for too long," said an official with a coking coal producer in Shanxi province.