Coke price could surge again in the long run as there is still room for the price of coking coal--the feedstock--to rise, industry experts say.

   Hua Zugui, executive director of China Coal and Coke Holdings Ltd., predicted at the recently held 6 China International Coal Conference that China's coke export price is likely to rise further as the spot price of the feedstock has exceeded US$200/ton.

   Hua also predicted that China's demand for coke will continue to grow although with a more relaxed speed.

   As its most important downstream sector, the iron and steel industry accounts for over 85 percent of total demand for coke, therefore the output of steel is a deciding factor in the total consumption of coke. China Iron & Steel Association's forecast put China's 2008 raw steel output at 520-540 million tons, up 6.3-10.4 percent year on year, as compared to the 15.6 percent growth recorded for 2007.

   Hua predicted that the era of low coal price has come to an end. In Jan. 2008, the northern coke price A and B index, which represent the level of domestic coke price and export coke price respectively, reached their highest-ever level of 384 and 503 respectively.

   China could become a net importer of coal in the next few years, Hua said, and this change will narrow the price gap between domestic and international coal prices.

   In 2007 China imported 51.02 million tons and exported 53.17 million tons of coal, with the net export being only 2.15 million tons.

   In the long term, domestic coking coal price will gradually climb, which will spread to the downstream coking sector, as coking coal feedstock accounts for 92-93 percent of the total production cost of coke.