🔹 Market Update

Yesterday afternoon, coking coal futures surged sharply, with some forward contracts hitting the daily limit-up. This move was driven by two key policy developments:

  1. China’s National Energy Administration issued a notice titled “Investigation on Coal Mine Production Levels”, requiring coal production to return to levels prior to the 2022 supply expansion campaign. This marks a significant shift from “supply guarantee” to capacity control, signaling a tightening stance on overproduction.
  2. The new version of the Coal Mine Safety Regulations was officially released and will take effect on February 1, 2026. These new regulations will impact the industry by:
    • Restricting supply, due to higher safety compliance standards
    • Raising costs, as substandard coal mines may be forced to halt operations or undergo upgrades

🔹 Market Sentiment & Outlook

The coking coal surge lifted overall sentiment across the ferrous complex, but current conditions do not support a full trend reversal.

The prevailing dynamic is:

  • Cost-side support from raw materials
  • Demand-side pressure remains due to sluggish downstream consumption

As such, the market is likely to stay range-bound over the next 1–2 weeks.

🔸 Price Ranges & Strategy

Forecasted short-term trading ranges:

  • Rebar: 3,190 – 3,270 CNY/ton
  • Hot Rolled Coil (HRC): 3,380 – 3,480 CNY/ton
  • Iron Ore: 780 – 810 CNY/ton

📌 Strategy: Maintain a cautious stance; trade the range with a short-term focus. Avoid chasing rallies until fundamental demand improves.