Indian domestic prices for blast furnace (BF) grade metallurgical coke have been edging down on subdued trading amidst partial lockdowns in many Indian states.
Moreover, the country’s domestic steel demand has been showing early signs of decline following the onset of the monsoon season, along with stringent restrictions imposed due to the coronavirus pandemic.
Indian domestic met coke prices, for 25-90 millimeter-sized BF grade material, are currently in the range of INR 27,000-29,000/tonne (t)in the country’s eastern and western coastal regions.
CoalMint assessed the blast furnace (BF) grade met coke, with 64% coke strength after reaction (CSR), at $436.00/t CNF India, up by $7/t (1.6%) on a week-on-week basis.
The 62% CSR BF grade met coke price increased by $8/t (2.1%) w-o-w to $395.00/t CNF India.
Import prices strengthen despite thin trading
Met coke import prices into India have resumed their upward journey over the past week amidst continued tightness in global supply, resulting from persistent high Chinese demand and record strong steel prices and margins in Europe.
However, Indian buyers continued to hold back on seaborne purchases amidst ample availability of relatively low-priced domestic material. Moreover, most end-users have slowed down their restocking activities since the last two months because of uncertainties following the resurgence in Covid-19 cases in India.
Exports gain pace amidst declining domestic sales
Indian coal traders and producers have been actively looking at export options for better price realisations compared to domestic sales.
A total quantity of 335,300 t of met coke had been exported this year to countries such as Vietnam, Brazil, Indonesia, Romania and Oman. Market participants strongly anticipate that this trend would continue throughout the remainder of this year at least.
So far in 2021, India exported 65,250 t of met coke to Vietnam, 60,500 t to Romania, 41,000 t to Brazil, 33,000 t to Indonesia and 22,000 t to Japan.
Besides, an 11,000 t cargo of met coke, destined for Australia, sailed late last month from Dhamra port in Odisha. This was exported by a major East Indian merchant coke producer.
Outlook
Supply tightness in both the domestic and import markets of high-quality, low-sulphur hard coking coal is likely to provide support to met coke prices in the near term.
Coke producers may turn cautious about procuring imported coking coal amidst persistent uncertainties over seaborne and inland transportation due to the ongoing pandemic.
Moreover, the country’s steel sector outlook appears bleak, given that the resurgent pandemic has resulted in reduced steel output.
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