South African thermal coal prices have been declining over the last two weeks, in response to weak demand from international market — prices for all grades have been following a downtrend since the beginning of the year in concurrence with falling demand in the global market.
The current offers for South African 5,500 kcal/kg NAR coal, mostly used by sponge manufacturers in India, have plummeted by almost 33% from its highest-ever value of around USD 91/MT FOB Richards Bay on 9 Jul’18.
Notably, the API 4 index for coal exported from South Africa’s Richards Bay terminal has further retreated to USD 78.30/MT, down 18.65% from USD 96.25/MT on 1 Jan’19.
Even though India has remained the largest receiver of South African coal, 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 77/MT fob Richards Bay South Africa.
RB2 (5,500 kcal/kg NAR) coal is assessed at around USD 61/MT fob Richards Bay South Africa.
RB3 (4,800 kcal/kg NAR) coal is assessed at around USD 47/MT fob Richards Bay South Africa.
For Indian buyers, the above offers amount to USD 90, 74 and 60/MT respectively, after charging an average freight rate of USD 13/MT for Panamax vessel class.
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