South African thermal coal shipments to its top export destination, India, witnessed a whopping 37% m-o-m rise to 3.1 mnt in Feb’22, CoalMint’s vessel line-up data revealed.
The rise came as limited portside inventory compelled traders to accumulate stock as sponge iron manufacturers kept making advance bookings amid weak coal stock at plants.
South African coal stock at Indian ports had reduced drastically in the past few months amid limited vessel arrival from the country.
A sharp fall in CIL’s coal dispatches to the non-power sector had further aggravated the situation leaving sponge iron manufacturers to rely more on the imported stock.
Shipments to Pakistan, Bangladesh decline
Elevated South African coal prices last month also made several buying countries take a backseat, including Pakistan and Bangladesh.
Shipments to Pakistan fell sharply by 39% m-o-m to 0.4 mnt, CoalMint data showed. This came as cement sales continued their declining trajectory in the country over the last few months.
Shipments to Bangladesh also fell sharply to 0.05 mn t, down 68% m-o-m.
Meanwhile, there were no shipments to China last month as higher domestic coal production dented any buying interest from the country.
Total coal exports rise
Amid constrained coal supply from Indonesia following the coal export ban, demand for South African coal gained momentum as South Korea and Japan looked for alternatives.
The country’s total thermal coal exports rose by 15% m-o-m to 5.6 mnt in Feb’22.
However, a rise was capped amid critically low stock levels at RBCT Port amid logistics disruption at the country’s biggest rail-operator, Transnet.
Shipments to South Korea were recorded at 4 mn t, up 24% m-o-m, while that to Japan were at 0.14 mn t, up 124% m-o-m.
Short-term outlook
The ongoing crisis between Russia and Ukraine has lifted demand for South African coal as Asian and European buyers scramble for non-Russian coal. This has made RB1 (6000 NAR) grade prices breach an all-time high level of $400/t. Shipments from the country are likely to be diverted more towards Europe, followed by Asia.
Leave a Reply