US coking coal prices continue to slide as overall demand is still sluggish, with steel market fundamentals and mills’ profit margins continuing to weigh heavily on regional sentiment.
Steel production declines are gathering pace in the Atlantic Basin, and reducing consumption of coking coal, as offtake from steel buyers in the US and Europe reduced, squeezing margins.
The Atlantic coking coal market remains under considerable pressure, with Europe still in the doldrums and Asia-Pacific indexes falling further.
US high-volatile coking coals are still being offered at considerable discounts to indexes, which is majorly attributable to the bearish steel industry.
The steep decline in FOB pricing for Australian premium hard coking coal in the Asia-Pacific markets has pushed down prices for US high-vol A and Low Vol coking coal.
In particular, the fob price of US high volatile A coking coal weakened relative to Australian low-vol premium HCC, with prices continuing to fall through the first half of the year.
In fact, the Atlantic metallurgical coal export markets have been hit by weaker steel prices and lower steel mill utilization rates right from the first half of this year.
PRICE ASSESSMENTS
The latest FOB US East Coast price of low-volatile hard coking coal is assessed at USD 134.00/MT, based on 58% coke strength after reaction (CSR), 8% ash, 0.8% sulfur and 19% volatile matter material.
For Indian buyers, the above price amounts to USD 166.50/MT on CNF India basis, after considering a USEC-India dry bulk freight rate of USD 32.50/MT for delivery by Panamax vessel class.
The US high-volatile type A (HVA) coking coal price is assessed at around USD 135.00/MT FOB USEC, based on 7% ash, 0.85% sulfur and 32% volatile matter.
The US high-volatile type B (HVB) coking coal price is assessed at around USD 127.00/MT FOB USEC, based on 8% ash, 0.95% sulfur and 34% volatile matter.
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