The domestic met coke prices have come down by INR 3,000/t m-o-m basis as the demand from steel mills in the merchant market has been quite dull. The price for BF grade met coke (25-90mm, BF grade) is currently assessed at INR 37,500-38,000/t ex-Jajpur.
The Indian mills are heard to have sufficient stock of imported met coke that has come from China, Poland, and even Japan. In last three months, India’s met coke imports during Sep-Nov’22 rose by 44% to 1.05 mnt, against Jun-Aug quarter.
China had been facing very slowed industrial activities since past few months due to covid restrictions there. This made Chinese met coke producers to divert their coke at cheaper rates to the Indian market. And although there is under-sizing issues with Chinese coke, the price at which it had been offered was quite lucrative, market participants have informed CoalMint.
The average price of Chinese met coke in Sep-Nov’22 stood at $415/t CNF India, against $455/t in previous three months.
With global steel demand being sluggish and many major mills cutting down on production, comparatively cheaper met coke has also arrived at Indian ports from Poland and Japan.
Domestic demand scenario
In terms of demand, while it was expected that post monsoons, India’s steel demand would pickup significantly, this didn’t happen. In November, India’s steel consumption has risen only marginally (m-o-m) to 9.66 mnt while country’s hot metal production has gone down by 4% m-o-m. Even in December, the domestic dynamics are expected to remain same. However, only push in steel production is expected against the background of exports. This is because with Indian government removing export duty on steel in mid-November, Indian mills are once again eyeing export markets.
Coking coal prices drop
Australian coking coal prices also recorded a drop of $22/t m-o-m in December. The price for premium HCC grade coking coal is assessed at $258/t FoB. This drop has come amid slowed demand from steel mills globally and no supply-related disruption since past a month.
Near-term outlook
Indian domestic met coke prices are expected to remain under pressure as India’s steel demand continues to remain steady and mills have sufficient coke stock till Dec-end. As China has removed its covid-restrictions recently, industrial activities have gained momentum and coke demand and prices are expected to go up. However, its positive impact on Chinese coke export offers will only be seen in January.
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