Tuesday, January 11,
Unprecedented flash floods in Australia, coupled with a possible hike in Chinese consumption may fuel prices of the black gold
Indian steel producers may see a sharp surge in April-June contract prices of coking coal as the floods in Australia-the worst in 50 years-have disturbed mining and global supply of the commodity.
Contracts for coking coal prices in the next quarter are likely to firm up at around $300 per tonne from the current January-March contract prices of $225 per tonne as the worst floods in Queensland, Australia, have affected mining and shipping operations, according to analysts.
The current situation in Australia has already led to an increase of coking coal prices to $250-$260 per tonne in spot markets.
Around 70% of India’s coking coal needs are met by imports; out of that, around 85% of these volumes are imported from Down Under.
“Contract prices are determined by spot market prices. But right now, it’s difficult to predict the quantum of the hike for April-June contract prices. But the market is expecting the upper (price) limit of $300 per tonne if the current situation in Australia does not improve,” an analyst from a foreign research firm said.
“It’s too early to give any price outlook for the next quarter. The price momentum for this quarter (January-March) also depends on the (improvement of the) flood situation in Australia. Currently, coking coal prices in spot markets are around $275 per tonne,” Arun Kumar Jagatramka, chairman and managing director, Gujarat NRE Coke Ltd.
Source: ML
Leave a Reply