Coke production rises by 9.4% yoy in 4M08

Coke production rises by 9.4% yoy in 4M08.

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Company, ths mt                     4M07     4M08  Chg, %
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Avdiyivka Coke (AVDK:BUY)          1,148.0  1,556.0    35.5
Alchevsk Coke (ALKZ:BUY)           1,043.0  1,220.0    17.0
ZaporizhCoke (ZACO:HOLD)           612.0    600.0      -2.0
Yasynivsky Coke (YASK:BUY)          582.0    550.0      -5.6
Bagliy Coke (BKOK:BUY)                233.0    245.1        5.1
Dniprodzerzhinsk Coke                  214.9    236.9       10.2
Others                                        2,871.1  2,922.0      1.8
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Total                                          6,701.0   7331.0      9.4   
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Source: Ministry of Industrial Policy

Andriy Gerus: Current market conditions are extremely favorable for coke producers: prices surged 120% yoy in May 2008. We stick to our bullish view on Avdiyivka and Bagliy Coke, taking into account their strong production growth in 4M08. We forecast the companies will increase output by 32% yoy and 19.9% yoy respectively in 2008. Though Yasynivsky Coke decreased production slightly in 4M08, we believe its mid-term perspectives are also positive due to strong demand for coke, secured coal supplies and the launch of coke battery #3 after repairs in April 2008 (see yesterday’s industry update for more).