Mongolia-China borders for coking coal exports to reopen March 2: sources

New York — The Mongolia-China borders of Ganshuunsukhait/Ganqimaodu and Ceke, the gateway for Mongolia coking coal to China, are expected to reopen on March 2, market participants said.

Both borders have been closed since February 11 after confirmation of cases of the coronavirus in Inner Mongolia. The closure was a measure to contain the virus.

"It's certainly a piece of good news, even though the impact from the closure was minimal," a Tangshan-based trader said.

"When the supply of Mongolian coking coal is back to normal, it may exert downward pressure on prices of imported coals from other origins in the short term," an end user said.

Mongolian coals have long been closely compared to Australia's Rangal HCC as they share similar specifications such as coke strength after reaction, volatile matter and ash content.

Others said the reopening of the borders may not provide the relief to seaborne coking coal prices. "This piece of news is nothing major in my opinion, but useful to gauge the improvement of the virus situation," another end user said. "I would still prefer to buy seaborne coking coal for this first half of the year because port policies will evolve and turn stringent in the second half."

A Northern China coke producer said that even as the borders reopen in March, washplants and truck drivers in Inner Mongolia may not necessarily resume full operations. "While there are some washed Mongolian coals entering China, a big chunk of these coals are unwashed," he said, estimating washed Mongolia coals to be about 20%-30% of Mongolia coking coal exports to China.

Some Northern Chinese end users in recent weeks turned to Jingtang port amid the squeeze in domestic Chinese and Mongolian coking coal, resulting in higher port stock prices. Platts last assessed Premium Low Vol ex-stock Jingtang at Yuan 1,500/mt Thursday, up Yuan 140/mt month on month, and HCC 64 Mid Vol ex-stock Jingtang at Yuan 1,340/mt, up Yuan 80/mt month on month.