Coking Coal Prices Stay Volatile as China Supply Outlook Shifts

Global coking coal markets remained volatile in October as Australian seaborne prices softened, Chinese spot values recovered and Beijing moved to accelerate domestic mine restarts. Steel-mill margins, Mongolian supply and disruptions in Russia are adding further uncertainty.

SEATTLE (Scrap Monster): Global coking coal prices continued to move unevenly through October as the market balanced recovering Chinese demand against expectations for higher domestic supply and cautious seaborne purchasing.

Premium hard coking coal FOB Australia was assessed at $272.40 per tonne on October 16, according to Kallanish data cited by GMK Center. That was 1.3% above the October 2 level, but below the $278.70/t recorded on September 18 and the $276/t level seen on October 9.

The mixed price pattern reflects uncertainty over how quickly Chinese domestic coal production will recover, how aggressively Indian mills will return to the seaborne market and whether supply disruptions elsewhere tighten availability.

Australian Coking Coal Trades in a Narrower Range

Australian seaborne coking coal prices softened at the start of the week after strengthening earlier in October.

Chinese buyers have increasingly favored domestic and Mongolian material, limiting demand for higher-priced Australian cargoes.

Indian steelmakers remain active in the seaborne market, but recent purchasing has been closely tied to immediate production requirements and freight economics rather than aggressive stockbuilding.

That leaves freight rates, steel margins and the relative cost of alternative origins as important short-term drivers for Australian coal.

Chinese Spot Prices Recover After Holiday Slowdown

Chinese coking coal spot prices strengthened following the October holiday period.

Spot coking coal in Anze was nevertheless still about 5.3% below its September 18 level.

Trading activity improved between October 8 and October 15 as buyers returned to online auctions looking for attractive offers after weaker activity in September.

China Pushes Mines to Restart Production

The futures market moved in the opposite direction as expectations for additional domestic supply increased.

On October 16, China's National Development and Reform Commission and National Energy Administration met with officials in Shanxi to accelerate the restart of suspended coal mines and increase production.

Authorities called for mine-by-mine restart plans, faster approval procedures and efforts to return operations to normal production levels while maintaining safety requirements.

The policy push has changed near-term expectations for Chinese coal availability and could place additional pressure on coking coal prices if production rebounds quickly.

Dalian Coking Coal Futures Drop 5.6%

The shift in supply expectations was reflected sharply in futures trading.

On October 19, the January coking coal contract on the Dalian Commodity Exchange closed at 1,403 yuan per tonne, down about 5.6% from the previous settlement.

The move was the contract's steepest decline in more than two months and reflected expectations for greater domestic and Mongolian supply.

The market stabilized afterward, with the benchmark closing near 1,407 yuan/t on October 20 and edging higher again the following session.

Chinese Coke Prices Face Mill Pressure

China's coke market has also weakened during October.

Steelmakers initiated two rounds of price reductions, with BigMint estimating cumulative cuts of approximately 200–220 yuan per tonne, or roughly $30–$33/t, since the start of the month.

Coke producers subsequently attempted to raise prices, but steel mills resisted those proposals.

The pushback reflects continued pressure on steelmaking margins and reinforces the importance of downstream profitability in determining raw-material demand.

Raspadskaya Shutdown Adds Russian Supply Risk

Russian supply remains another variable for Asian coking coal buyers.

Production at the Raspadskaya mine was suspended after a fire in a dismantling chamber on September 30. All 305 workers were safely evacuated and no injuries were reported.

Russian mining regulator Rostekhnadzor later ordered mining operations at the mine suspended for 90 days, except for essential life-support and safety work.

Raspadskaya is one of Russia's major premium coking coal operations and supplies both the domestic market and Asian customers.

The disruption does not by itself signal a broad shortage of Russian metallurgical coal, but the extended shutdown adds another supply consideration at a time when Asian buyers are closely comparing Russian, Mongolian and seaborne alternatives.

What to Watch Next

Chinese mine restarts: The speed at which Shanxi operations return to full production will be a major driver of domestic pricing.

Mongolian imports: Greater availability from Mongolia could continue to pressure Dalian futures and reduce China's need for higher-priced seaborne coal.

Indian demand: Australian exporters will be watching whether Indian mills move beyond requirement-based purchases and begin rebuilding inventories.

Steel margins: Weak mill profitability could limit raw-material buying even if steel production remains elevated.

Russian supply: The duration and operational impact of the Raspadskaya shutdown will remain relevant for premium coal flows into Asia.

Market Outlook

October's coking coal market is being shaped less by a single supply shock than by competing regional signals.

Australian prices remain elevated compared with late summer, but buying interest is selective. Chinese spot demand has recovered, yet government efforts to boost domestic production have weakened futures expectations.

For the remainder of the month, the balance between mine restarts, Mongolian supply, Indian seaborne demand and steel-mill profitability is likely to determine whether prices regain upward momentum or face renewed pressure.

Courtesy: GMK Center