Fitch Ratings has estimated HSX-listed Mongolian Mining Corporation (MMC)’s ratings at ‘B’. The outlook is stable, according to the estimation. The Government has banned coal export until March 15 in consideration of preventing coronavirus outbreak. However, MMC had already intensified extractions to enhance stockpiles on both sides of China and Mongolia ahead of shut down borders. The company would be ready to resume its sales via inventoryde-stocking. According to the Fitch Ratings, steel demand is weak in China due to low resumption of construction activities, which has led to turn down in steel product prices, while coking-coal inventories at steel mills are running low and would need to be re-stocked in the near future. Chinese coking coal producers are experiencing difficulties as transportation gets restricted and the low availability of labor. This could lead to high demand for coking coal from other sources such as MMC. Furthermore, MMC is likely to hike its coal export within five years by advancing entry both from and into China.

Published Date:2020-03-09