Australian premium hard coking coal prices retreated further this week amid lower price indications and relatively fewer bids.
In the last week, however, offers for premium hard coking coal had inched slightly higher due to limited tradable resources and growing buying interest from Southeast Asia and India over the week.
The price spread between the premium low-vol (PLV) and mid-vol (PMV) hard coking coal has expanded, with FOB prices for premium low vol coals continuing to fall as lower offers failed to draw demand in the spot market, while restocking demand from Indian end-users could lend some support to PMV coals in the near term.
Healthy steel market fundamentals lend support to Indian coking coal and coke prices
In the Indian market, the downstream steel demand recovery has picked up pace on stronger construction activities. Strong domestic steel and coke prices may lend support to pre-monsoon restocking, as the monsoon season approaches in June-July.
Hence, the overall market sentiment for coking coal may stay firmer in April than March because of more procurement activities once mills have consumed existing stocks.
Furthermore, the current profit margins in major Indian steel mills are decent, which may support the imported coking coal prices.
Notably, India’s coking coal imports from Australia registered a 19.3% m-o-m growth in the last month of March to 4.26 mn t as compared against 3.57 mn t in February.
Price Assessments
Latest prices for the Premium HCC and the 64 Mid Vol HCC grades are assessed at around $110.00/t (-2.2% w-o-w) and $106.00/t (-2.1% w-o-w) FOB Hay Point, Australia.
For Indian buyers, these prices amount to $129.80/t (-2.5% w-o-w) and $125.80/t (-2.4% w-o-w) respectively on CNF India basis.
Australia-India dry bulk freight rate is currently assessed at $19.80/t (-4.1% w-o-w) for delivery by Panamax vessel class.
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By Aditya Sinha
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