MARKET TREND
Subdued demand has eroded the intensity of trading activity in the Coking Coal market in Australia—the prime export market for the coal.
Demand for the coal has slacked as the steel market in China turned sluggish, resulting in unsold inventories of steel rising at the steel mills in that country. In response, the operating rates of the steel plants there have been lowered, reducing the consumption of the coal—thus, import demand for the coal has loosened.
Moreover, strict norms imposed on Blast Furnaces in China on environmental concerns also have contributed towards reducing the appetite for importing the coal.
Coking Coal sellers in Australia have been left with no other option but to reduce their spot prices to entice buyers.
PRICE TREND
Offers for the Premium HCC were reported at USD 214/MT FoB Australia, a dip of around USD 1.5/MT over the week-ago offers. At the same time, offers for the 64 Mid Vol HCC were reported to hover almost at around the offers in the week last. This week, the 64 Mid Vol HCC were offered at around USD 196.90/MT FoB Australia.
Source: CoalMint Research
On CFR India basis, these offers amount to: USD 228.60/MT and USD 211.50/MT respectively.
IMPORTS
The Indian steel makers have, however, not lowered their imports as active steel production was going on. Moreover, there has also been no reduction in the operating rates in the steel plants in India; and hence influx of Coking Coal imports remained uninterrupted in the country.
As assessed by CoalMint Research, around 2.9 MnT of the coal was imported in India during the 1-19Mar’18 period.
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