Report Industry Investment Rating - Not provided Core View of the Report - The coking coal supply and demand pattern is directly affected by upstream coking coal costs, downstream steel demand, and macro - policy orientation. With the coking coal comprehensive inventory at a moderately high level and overall weak supply and demand, the short - term demand is boosted by the seasonal inventory build - up of downstream steel mills, a slight increase in hot metal production, and on - demand restocking. Macro - level interest rate cut expectations from the domestic central bank and the Fed greatly boost market confidence, and the short - term market trading logic shifts to strong macro - expectations. It is expected that coking coal will continue to rebound in the short term, and a low - buying strategy is recommended [1][2] Summary by Related Catalogs Market Analysis - **Coke Inventory**: As of December 31, the inventory of independent coking enterprises decreased 0.69% month - on - month to 91.6 million tons, steel mill inventory increased 0.28% to 643.99 million tons, port inventory slightly decreased to 243.09 million tons, and the comprehensive inventory slightly increased 0.04 million tons to 978.68 million tons, with the year - on - year increase narrowing to 2.93% [1] - **Profit**: The average profit per ton of 30 independent coking plants nationwide was - 14 yuan/ton. The average profit of Shandong quasi - first - grade coke increased slightly to 1 yuan/ton (also mentioned as 34 yuan/ton, possible error in the report), Inner Mongolia second - grade coke decreased slightly to - 67 yuan/ton, and Hebei quasi - first - grade coke was 43 yuan/ton [1] - **Downstream Demand**: Steel prices fluctuated in the short term, with apparent demand in a seasonal contraction phase. The profitability rate of 247 steel mills rose to 38.1%, and the daily hot metal output increased 0.85 million tons week - on - week to 227.43 million tons, 2.23 million tons more than last year [1] - **Upstream Coking Coal Inventory**: Coal mine coking coal inventory increased 3.68% to 293.3 million tons, port inventory increased 4.17% to 539.48 million tons. Independent coking enterprises' inventory slightly increased to 1052.5 million tons, and steel mill inventory decreased 0.55% to 802.27 million tons. The comprehensive inventory increased 40.31 million tons to 2687.55 million tons, with a year - on - year decrease of nearly 14% [2] - **News**: The central bank's working conference from January 5 - 6 continued to implement a moderately loose monetary policy. Fed Governor Milan said the Fed needs to cut interest rates by more than one percentage point in 2026 [2] Futures and Spot Market - **Futures**: The 05 - contract coke opened at 1650, closed at 1773, hitting the daily limit, with an increase of 1679 lots. It is expected to continue the short - term rebound, and attention should be paid to the support of the 20/40 - day moving averages and the pressure near the previous high [4] - **Spot**: The spot prices of quasi - first - grade (wet - quenched) coke, quasi - first - grade (dry - quenched) coke, and first - grade (wet - quenched) coke were 1440 yuan/ton, 1640 yuan/ton, and 1540 yuan/ton respectively [5]

Core Viewpoint - The prices of coke and coking coal have shown a fluctuating upward trend since early July, driven by a stable and improving supply-demand balance, with investors advised to look for buying opportunities during price corrections [1][3]. Supply and Demand Dynamics - The majority of coke is used in the iron-making process of steel production, making the demand for coke closely linked to pig iron output and national blast furnace capacity utilization rates. In the first half of the year, national pig iron production reached 43.2681 million tons, a year-on-year increase of 2.2%, indicating expanding demand for coke [2]. - The capacity utilization rate of blast furnaces in 163 steel mills has been steadily rising, from a low of 72.67% at the end of February to a peak of 79.77%. Although there was a slight decline in July due to compressed profits, the impact on coke demand was limited, with the utilization rate recovering to 79.49% by the end of July [2]. Supply Side Changes - In the first half of the year, national coke production was 43.2681 million tons, a year-on-year decrease of 2.5%, indicating a slight contraction in supply. The capacity utilization rates of 100 coke ovens have remained stable, ranging from 79.81% to 80.00% over the past four weeks [3]. Inventory Levels - As of the end of July, the total inventory of independent coke plants was 470,100 tons, up from 385,900 tons at the end of June. The total inventory at four ports was 2.65 million tons, down from 3.005 million tons before the Spring Festival. The inventory levels at 110 steel mills also increased to 4.9228 million tons from 4.6382 million tons at the end of June [4]. - The accumulation of inventory is not significant, with the increase in upstream and steel mill inventories being offset by a decrease in port inventories. This limited accumulation suggests a minimal negative impact on prices [4]. Price Dynamics - The fundamentals of the coal and coke market remain strong, providing upward price support. However, the current futures prices may be overvalued, as the coke 2009 contract is trading above 2,000 yuan per ton, while the port spot price is around 1,900 yuan per ton [5][6]. - The ratio of coke to coking coal contracts is currently at 1.63, indicating a historically high level of profitability in the coking sector, which also suggests potential overvaluation of coke futures prices [6].

Core Viewpoint - The prices of coke and coking coal have shown a fluctuating upward trend since early July, driven by a stable and improving supply-demand structure, with investors advised to look for buying opportunities during price corrections [1][3]. Supply and Demand Dynamics - The majority of coke is used in the iron-making process of steel production, making it essential to monitor changes in pig iron output and national blast furnace capacity utilization rates. In the first half of the year, national pig iron output reached 43.2681 million tons, a year-on-year increase of 2.2%, indicating expanding demand for coke [2]. - National blast furnace capacity utilization rates have been rising, from a low of 72.67% at the end of February to a peak of 79.77%. Although there was a slight decline in July due to compressed profits, the impact on coke demand was limited, with rates rebounding to 79.49% by the end of July [2]. Supply Side Changes - In the first half of the year, national coke production was 43.2681 million tons, a year-on-year decrease of 2.5%, indicating a slight contraction in supply. The capacity utilization rates of 100 coke ovens remained stable, ranging from 79.81% to 80.00% over the past four weeks [3]. Inventory Levels - As of the end of July, independent coke plant inventories totaled 470,100 tons, up from 385,900 tons at the end of June. Port inventories were at 2.65 million tons, down from 3.005 million tons before the Spring Festival. Steel mill inventories also increased to 4.9228 million tons from 4.6382 million tons [4]. - The accumulation of inventory is not significant, with the increase in upstream and steel mill inventories being offset by a decrease in port inventories. This limited accumulation has a minimal negative impact on prices [4]. Futures Market Insights - The fundamentals of the coal and coke market remain strong, providing upward price support. However, the current futures prices may be overvalued, as the coke 2009 contract is trading above 2,000 yuan per ton, while the port spot price is around 1,900 yuan per ton [5][6]. - The ratio of coke to coking coal contracts is at 1.63, indicating a historically high level of profitability in the coking sector, which also suggests potential overvaluation of coke futures prices [6].