The QHD price slid slowly to RMB985/t in October, despite winter-like weather in some northeast areas. In addition to the high number of seaborne imports, recovering domestic supply also pushed the price downward. Coal inventory at ports, as a key indicator of the market, also increased significantly in October. We expect the upward trend to continue in November. More steel mills finally started to slow down their blast furnaces after suffering months of low or no margins. However, we don’t think they are determined enough to do so consistently as some of them still have access to the term-contracted low-priced coal. The price arbitrage with the spot market coal somehow supports the steel mills with the illusion of producing more, even with slim margins, so they can squeeze the high-cost mills out of the market.