News >> National News

China's latest effort in revitalizing the steel and automobile industries will help domestic steel industry resume stable production and thus stimulate a rally in the demand for coke.

Meanwhile, the internal rectification also favors its healthy development of the coke industry.

Facing the sluggishness of domestic coking industry, Chinese(cnmining) government and coking industry associations have carried out a series of policies to adjust coke production and distribution, which to certain extent eases the coke oversupply in domestic market.

All these measures are believed to promote the recovery of coking industry.

Statistics show that some 90 percent of domestic coke is consumed for iron and steel smelting. The slowing world economy and gloomy real estate and automobile industries in 2008 sharply shrank the demand for steel in domestic market.

In 2008, coke demand decrease for 6 consecutive months since June and came at 22.0154 million tons in November, down 3.11 percent or 706,700 tons on months and down 22.16 percent or 6.2682 million tons on year.

Meanwhile, coke price surged from 1,750 yuan per ton at the beginning of the year to 3,000 yuan per ton in late July, but took a downturn since August and plunged to 1,700 yuan per ton at present.

Accordingly, the profit of coking enterprises decreased along with the weakening demand from downstream sectors, overproduction capacity and declining coke price. Some coking enterprises even incurred great losses in 2008.

According to Zhang Gangfeng, general secretary of Shanxi Coking Industry Association, the entire coking industry in Shanxi province suffered a total loss of 3 billion yuan in Sept.-Oct. of 2008.