South African thermal coal prices have fallen marginally by around USD 3-5/MT in this week, primarily owing to subdued buying interest in India and constantly falling demand in the global market.
Currently, the API 4 index for coal exported from South Africa’s Richards Bay terminal has also retreated to USD 79.60/MT, down 17.3% from USD 96.25/MT on 1 Jan’19.
Offers for the South African 5,500 kcal/kg NAR coal, mostly used by sponge manufacturers in India, have been continually softening since having attained its highest-ever value of around USD 91/MT FOB Richards Bay on 9 Jul’18.
The bearish market outlook is constantly exerting pressure on international miners and traders to lower their sale offers for coming weeks.
However, market sources expect that prices will not decline further below the current level as the forward benchmark price is reflecting an uptrend.
Notably, South African non-coking coal shipments to India plunged by nearly 54% to 1.59 MnT on a month-to-month basis in the month of February from 3.45 MnT in January, as per the latest vessel lineup data compiled by CoalMint Research.
PRICE ASSESSMENTS
RB1 (6,000 kcal/kg NAR) coal is assessed at around USD 78/MT fob Richards Bay South Africa.
RB2 (5,500 kcal/kg NAR) coal is assessed at around USD 56/MT fob Richards Bay South Africa.
RB3 (4,800 kcal/kg NAR) coal is assessed at around USD 45/MT fob Richards Bay South Africa.
For Indian buyers, the above offers amount to USD 91, 69 and 58/MT respectively, after charging an average freight rate of USD 13/MT for Panamax vessel class.
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