Reportedly, the coking coal prices are likely to be recovering in July after the long time depression due to the expected rising steel capacity in China and India under the growing world economies.
It is forecasted that contract prices of coking coal may fall to US$206/ton in this Q2 while it may hit to average level of US$225/ton this financial year.
China is the world's largest steel producer and its steel demand is predicted to increase by nearly 10% this year. Therefore, ten new blast furnaces have been established in the last six months to boost steel production to reach a high level in March.
Meanwhile, India, the third biggest steelmaker, was pushing its capacity to more than 100 million tons by March to meet the high demand from the infrastructure for roads, bridges and railway networks in the future 5 years.
It is analyzed by Mr. Natalie Robertson, an analyst of ANZ that China may exceed Japan to be the biggest importer of coking coal by 2015, but it may be replaced by India eventually. China's growth is much slower than expected in these three years although government has loosened the policy to boost the economy, however its development still under tracking.
According to Australia Bureau of Resources and Energy Economics, China's imported coking coal demand was 63 million tons in March, 37% higher than last year. The surging demand was attributed to the state investment plan in steel-intensive infrastructure, such as highways and rail networks linking the less-developed provinces in western China to demand center in the east