- Buyers adopt wait-and-watch approach amid elevated prices and uncertain freight
- Sponge iron rises INR 600/t w-o-w; domestic coal remains stable
South African thermal coal prices at Indian ports increased further w-o-w, supported by tight portside availability and firm freight levels amid ongoing geopolitical tensions. As per BigMint’s assessment, exw-Paradip RB2 (5,500 NAR) rose by INR 500/t w-o-w to INR 12,200/t, while RB3 (4,800 NAR) increased by INR 200/t to INR 10,600/t. Prices remained supported by higher seaborne offers and uncertainty surrounding freight and shipping schedules. However, since last two days, prices have remained stable across the ports.
Market participants noted that buyer acceptance remained limited despite the price rise, with most consumers reluctant to match elevated offers. As a result, the bid-offer gap widened, and overall trading activity remained thin as buyers preferred to wait for clearer direction on freight and global market developments.
Export offers and freight uncertainty continue to influence costs
Freight levels moved higher during the week. As per BigMint’s assessment, coal vessel freight from Richards Bay (South Africa) to Paradip (India) increased by $5/t w-o-w to $21.6/t, although market participants indicated that freight levels could fluctuate within $22-25/t for certain shipments due to ongoing geopolitical tensions and rising global oil prices.
Market sources reported very limited enquiries for CIF cargoes, while portside inventories of South African coal remained tight. Some shipping lines were also hesitant to commit firm delivery schedules amid uncertainty in global shipping routes linked to the conflict.
Offers for March-ending vessel arrivals at Mangalore were heard around INR 11,700/t exw for 5,500 NAR, though transactions were scarce as buyers remained cautious.
Buyers stay sidelined amid uncertainty
Several consumers indicated that they were covered with inventories until April, reducing immediate procurement needs. A buyer noted that they were unlikely to enter the market until there is more clarity regarding the geopolitical situation and freight movements.
With prices at elevated levels, many buyers adopted a wait-and-watch strategy, indicating that domestic coal could become a preferred alternative if imported offers remain high for an extended period.
The global market also witnessed volatility in benchmark indices, with the API index falling by around $7 earlier in the week before recovering, adding to uncertainty in seaborne pricing signals.
Domestic coal stable; sponge iron prices rise
Domestic non-coking coal prices remained stable w-o-w, indicating limited direct impact from the sharp rise in imported coal prices.
Meanwhile, the sponge iron P-DRI DAP Durgapur price increased by INR 600/t w-o-w to INR 26,300/t, supported by higher raw material costs.
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