South African 5500 NAR Thermal coal offers remain strong this week also and assessed at USD 49-50/MT, CFR India for Apr’16 loading. While, offers gain by 4-5% W-o-W, hitting 3-month high.
South African coal market has been booming as driven by improved Indian sponge iron industry now a days. Meanwhile, South African coal index seems to be fix on upper side from couple of weeks as also awaiting for Japanese coal tender to close in Mar’16 end.
South African coal offers, which were showing on upper side from couple of weeks, again reflected a marginal rise of about USD 2/MT this week. SteelMint assessed that South African spot offer for 5500 NAR is hovering in the range of USD 43-43.5/MT, FoB and within USD 51.5-52/MT, FoB for 6000 NAR for Apr’16 shipments.
[su_pullquote align=”right”]An east India based trader highlighted, “South African coal market saw a marginal rise in the current week. RB2 is being offered at USD 50/MT, CIF Paradip port for Apr’16 loading and USD 49-49.5/MT, CIF West Coast India. Contrastingly, any physical trade on this offers have not seen yet because Indian buyers are looking for discount of USD 2-3/MT as cheaper alternatives are available in the market.”[/su_pullquote]
Although, Indian buyer’s expectations for South African 5500 NAR is heard at USD 47-47.5/MT, CFR East Coast India for Apr’16 loading. Meanwhile, low GCV 4800 NAR is being offered at USD 41-42/MT, CFR East Coast India.
Moreover, market is not seemed bullish as there is still limited buying interest and thus prices on upside is anticipating for very short duration. On the other side, high sea freight rates has increased CFR offers to India, making Indian buyers wary for import.
At present, there is some demand for low GCV South African material as Indian sponge utilities mostly preferred material such as 4,800 NAR and 5,500 NAR, South African coal. In addition, about 80-90% cement companies have shifted to pet coke, which was traditionally bought 6,000 NAR coal for their units.
Vessel freight rates
The current Sea freight market has risen marginally on the ground of highly volatile crude oil market and lack of cargo availability. Freight for shipping coal in Panamax vessel from South Africa to India is assessed at USD 7/MT. Meanwhile, freight for all size of bulk vessels has increased now.
Expected South African Coal Vessels in March
As per SteelMint data analysis, at present about 1.2 MnT South African Non-coking coal expected to reach at different Indian ports till 24 Mar’16. While there have some big importers contributing a large share such as Adani Enterprises, JSW Energy, Gandhar Oil and Hindalco expecting vessel at Gangavaram (0.33 MnT), Jaigarh (0.3 MnT), Gangavaram (0.22 MnT) and Gangavaram ports respectively.
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