South African Coal Prices Inch Up

Prices for South African coal cargoes have gained to about USD 54/MT, FoB (6000 NAR) this week from Richards Bay for current bookings.

South African Thermal coal mostly traded in India is showing a marginal rise of about USD 2-3/MT this week for Dec’15 deliveries. Current offers for South African RB2 are assessed at USD 52/MT, CIF East Coast India for Dec’15 deliveries. While, low GCV South African RB3 is being traded at USD 32/MT, FoB for current bookings.

Low availability of South African cargoes coupled with increased demand in Northern Hemisphere owing to winter has supported prices to inch up marginally. In current scenario, large global miners are holding cargoes because of expected rise in prices.

[su_quote]An official from one of the biggest coal trading firm in India highlighted, “At present, overall coal market is oversupplied, but lack of cargo availability by the leading South African miners has driven market to go up. In addition, continuous falling supply of Thermal coal has resulted in scarcity of South African coal for now.”[/su_quote]

He further added, currently in India, Australian Thermal coal offers are very competitive for South African grades.

Stock and sell offers are stable at INR 4,200-4,350/MT (all duties and clearance included, VAT & CST will be added further) at all Indian ports.

At present, 2 capsize vessels (3 MnT) of South African 5500 NAR coal are expected to reach at Gangavaram and Dhamra ports till the month end. Meanwhile, the same grade material is currently offered at USD 51/MT, CIF Paradip and USD 52/MT, CIF Vizag Port.