India: Portside South African thermal coal market quiet amid monsoon lull

• Monsoon to weigh on demand in next few months
• Port stocks increase 2% w-o-w amid higher arrivals

South African thermal coal prices in India remained under pressure this week. As per BigMint’s latest assessment, RB2 (5500 NAR) was assessed at INR 7,900/tonne (t) exw-Gangavaram, unchanged w-o-w. RB3 (4800 NAR) also remained flat at INR 6,900/t. Prices remained at four-year lows, with limited buying interest due to the monsoon keeping trade volumes thin.

Buyers bid actively, but most of these were below sellers’ expectations. Very low bids led to subdued sentiment, and most trades failed to conclude. However, a deal for 10,000 t of RB2 was heard at INR 8,100/t exw-Vizag. In Mangalore, bids for RB2 ranged between INR 7,700-7,900/t, with 7,000 t reportedly booked at INR 7,900/t.

Thermal coal stocks at Indian ports rose almost 2% w-o-w to 15 million tonnes (mnt) in week 21 of CY’25 due to increased arrivals at several ports.

Domestic coal prices ease on weak industrial demand

Domestic coal prices declined slightly, as demand remained subdued. The 4500 GCV grade dropped INR 50/t w-o-w to INR 4,300/t exw-Bilaspur, while 5000 GCV held steady at INR 4,800/t. SECL allocated 676,200 t in its 26 May auction, with G11 accounting for the bulk of the volume, largely absorbed by power sector players. Lack of end-user participation from the industrial sector continued to weigh on the open market.

Sponge iron prices soften further

CDRI prices at Rourkela dropped INR 200/t w-o-w to INR 24,500/t exw amid limited buying. The broader PDRI range stood at INR 23,350-25,700/t, while CDRI hovered within INR 24,700-29,800/t. The downtrend in steel prices continued to pressure sponge iron valuations.

Export offers soften slightly

South African RB2 export offers dropped by $2.5/t w-o-w to $71/t FOB, while RB3 remained stable at $60/t FOB. Export sentiments weakened due to slow offtake from Asian markets and falling portside realisations in India. Sellers faced pressure to reduce offers further amid muted global demand.

Outlook

With monsoon expected to persist for the next few months and no near-term demand triggers visible, the thermal coal market is likely to remain weak. Buyers will likely remain cautious unless offers drop further or steel demand revives.