Indian CFR prices of petroleum coke (petcoke) imported from USA have declined modestly because there has been a sharp drop in freight rates for Supramax vessels from the U.S. Gulf Coast (USGC) to India.
SteelMint assessed the latest petcoke freight rate for a Supramax vessel (Cargo Intake 55,000 mt) from Port Houston in Texas to Visakhapatnam Port, Andhra Pradesh at $38.79/mt, down $4.27/mt W-o-W and $6.02/mt M-o-M.
The freight rate for a Supramax vessel to move petcoke from Newport News, Virginia to Vizag was assessed at $42.00/mt, down $4.10/mt W-o-W and $6.03/mt M-o-M.
However, there is no change in Saudi-to-India freight rates for petcoke. And hence, the price gap between imported petcoke of US and Saudi origins has narrowed down.
Meanwhile, in the Indian domestic market, petcoke consumption by Mukesh Ambani-led Reliance Industries (RIL) has considerably increased due to its $4-billion gasification project from December last year. RIL’s additional petcoke intake is expected to rise further in coming months when more units commence stabilization.
Moreover, RIL has shut down a coker unit of its domestic tariff area (DTA) refinery at Jamnagar (till 1st week of Feb’19) for adding two more coke drums which will increase its overall coking capacity. This has affected the production and consequently resulted in lower availability of petcoke in India’s domestic market.
Therefore, greater buying interest could emerge for seaborne petcoke cargoes, particularly the high-sulfur Saudi-origin petcoke, having a transportation advantage to India and thereby significantly reducing lead time. It might eventually firm up Saudi petcoke prices, thus shrinking the price gap between US & Saudi petcoke.
PRICE ASSESSMENTS
The current prices of petcoke (6.5% Sulphur) from USA are assessed to have dropped by about USD 2.5/MT to the tune of USD 92-93/MT CNF India.
Prices for petcoke (9% Sulphur) from Saudi Arabia are presently varying in the range of USD 90-91/MT CNF India.
Source: CoalMint Research
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