Offers for domestic metallurgical (met) coke in India have remained unchanged on the week as coking coal import prices rose marginally by $1.5/tonne (t) w-o-w basis and also because of no significant improvement in existing steel demand.
Prices for 25-90 mm blast furnace (BF) grade met coke in both east and west zones are heard at INR 39,000-40,000/t. Prices are exclusive of 5% GST. However, in a deal, about 20,000 t of the same grade met coke has been sold at INR 42,000/t at Vizag Port.
In conversation with various market participants, CoalMint learned that not many deals were finalised this week as a few merchant met coke sellers decided to hold their offers till mid-Jan’22 in anticipation of rise in coking coal prices while some others were heard to be blaming sluggish domestic steel demand for limited spot inquires of met coke.
Indian pig iron prices fall, steel demand sluggish
Prices for steel grade pig iron registered a fall of INR 800/t w-o-w basis and are currently assessed at INR 39,000/t exw-Durgapur while foundry grade pig iron prices also fell marginally by INR 200/t w-o-w to INR 45,200/t DAP-Ludhiana. Finished flat steel prices slumped by INR 1,300/t in the last ten days.
At present, Indian steel demand is slow because of a decline in construction activities in the North India coupled with illegal sand mining issues in eastern and northern regions. Adding to the woes is reduced steel demand from the automobile sector due to the shortage of semiconductors globally that resulted in huge production loss, even in India.
Australian premium coking coal prices rise marginally
Seaborne coking coal prices increased by $1.5/t this week. Prices for Australia-origin low volatile hard coking coal are currently assessed at 342.5/t. The coking coal supply from the country continues to remain constrained amid rains and bad weather conditions in mining areas.
Also, the inquiries from the ex-China Asian market were heard to be gaining momentum this week on restocking demand which indicates that coking coal prices would go up further in the upcoming weeks.
Outlook
Near-term met coke prices are expected to remain supported as coking coal prices would rise. The Indian steel demand is likely to gather pace from January, supporting met coke prices. The only concern could be rise in Omicron cases in India and subsequent restrictions if any, that would once again blow a dent on Indian steel and met coke demand.
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