Two different signals are coming this morning from the markets for Mongolia's main export commodities. Coal and copper prices are rising, while oil has fallen toward $100, easing the pressure of import costs somewhat.

At the Mongolian Stock Exchange session on 21 September, the price of 12,800 tonnes of washed coking coal from “Energy Resources” rose 12.61 percent, from 1,150 yuan to 1,295 yuan per tonne. Five competing buyers indicate that genuine demand on the exchange has increased.

Growth also continued in the copper market, with LME three-month copper reaching $14,654 per tonne. This brings it close once again to the historic high of $14,875 set on 10 September. Expectations of stronger seasonal Chinese demand are the main driver of the increase, and if this level holds it will have a positive effect on Oyu Tolgoi's exports, on foreign currency earnings and on mining revenue for the state budget.

Oil, by contrast, moved in the opposite direction. Brent fell 3.4 percent on Monday to close at $100.34, and WTI at $95.78. A partial recovery in Saudi Arabian exports and expectations of progress in US–Iran diplomatic talks reduced the supply-risk premium.

For Mongolia, oil falling toward $100 is a positive signal for fuel import costs, transport and food prices, and for inflationary pressure. Geopolitical risk in the Middle East has not fully cleared, however, so it is too early to treat the decline as a stable trend.

In the domestic financial market, subscription for the ₮100 billion “Shunkhlai-4” bond opens today. The bond has a 12-month maturity and an annual interest rate of 18 percent. With the Bank of Mongolia holding its policy rate at 12.5 percent, a private company raising funds at an 18 percent coupon shows that the cost of togrog financing for business remains high.

Total trading on the MSE the previous day reached ₮60.8 billion, but most of that was made up of a large secondary-market transaction in corporate bonds. Activity in the domestic capital market therefore appears to be concentrating on debt instruments rather than equities.

Externally, the United States and China are continuing their talks on trade, tariffs, critical minerals and artificial intelligence. For Mongolia this remains the key external factor affecting the coal and copper markets through Chinese industrial demand.

SoftBank has also issued $10 billion in dollar bonds and €1 billion in euro bonds, directing the bulk of the proceeds to its investment in OpenAI — a sign that artificial intelligence investment is moving ever deeper into global debt markets.

This morning's picture therefore fits into a single sentence: prices for Mongolia's main export products are supported and the pressure from oil has eased somewhat, but the cost of domestic financing remains high and external risks persist.

Source: cnbc mongolia news site