In early August, the Canadian coking coal market has not shown any noticeable improvement, but domestic miners are expecting to see more profitable contracts in the coming weeks, as it has been noticed that in Chinese market slight improvement has been witnessed. The Premium-quality Coking coal has been traded at USD 130-135/MT FOB.
Most of the Canadian producers are holding back high-quality coal in stock and offering lower-grade material in the spot market. Canada's leading mining company Teck Resources, which has 13 mines in Canada, Chile and Peru, is in talk with some buyers from China, Brazil and India for supplies of additional quantities. The company sells about 500,000 MT of coal in India annually. Teck Resources also intend to offer Erdemir, Turkey's leading steel manufacturer, which has entered the North American market to source coal with the average volatile matter.
Chinese business activity is improving now and Chinese coke plants are planning to request for quotation as Coke has priced up by RMB 20-30 in some Chinese province during the past week. The Chinese ports coal stock has been depleted but still they are having a substantial amount of coal around 7.6 MnT. However, steelmakers are confronting high-quality material shortage and are looking forward to import it but they are not ready to accept any substantial price rise.
Some Indian representatives are negotiating on the long-term contracts with the local authorities of British Columbia (Canada). Demand from Indian importers remains very small in the free market over reduced capacity utilization, the ongoing monsoon season and the state holidays (on August 8-11).
However, Brazilian suppliers are ready to negotiate supplies of premium-quality coal in October-November. Offer prices exceed bids by USD 5/MT on average, but producers plan no reductions in prices and are expecting the market to rally by the end of the year.
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