- China market characterised by tight coal availability, inspections
- Market participants expect demand to improve post monsoon
India’s domestic metallurgical coke market remained broadly stable in the week ended August 13, with market activity subdued amid cautious procurement by steel mills. BF-grade met coke prices in eastern India remained unchanged at INR 35,300/t ex-Jajpur, while prices in western India were stable at INR 33,500/t ex-Gandhidham.
Foundry-grade coke also remained firm at around INR 36,400/t ex-Rajkot, supported by relatively stable demand from the casting industry. However, weak finished-steel demand and limited spot transactions continued to restrict buying interest. Falling iron ore prices have further weighed on sentiment, as buyers anticipate potential pressure on steel and coke prices, while rising raw material costs are simultaneously squeezing coke producers’ margins.
Market participants expect demand to improve after the monsoon, which could encourage restocking and provide support to coke prices; however, the timing and strength of the recovery remain uncertain.
Indonesian coke stable, Australian coal strengthens
Imported Indonesian BF-grade met coke (65/63 CSR) remained stable at $308/t CFR India. No recent bookings were reported for Indonesian met coke cargo this week for India, however, market is awaiting the outcome of Vizag Steel’s imported met coke purchase tender. Australian PHCC coking coal prices increased by $10/t w-o-w to $224/t FOB Australia, indicating firmer international coking coal fundamentals.
The stability in imported coke is currently limiting cost-driven pressure on Indian domestic prices, although higher coking coal prices could raise replacement costs if the strength persists.
China market: Tight supply supports firmer sentiment
China’s coking coal and met coke markets remained broadly stable w-o-w, supported by tight coal availability amid stringent safety inspections and limited mine production recovery. Coke supply has also tightened as loss-making plants curtailed output following earlier price cuts, while the restart of some blast furnaces has provided modest support to demand.
With steel mills and coke producers engaged in price negotiations and some coke plants seeking price increases, market sentiment has turned cautiously firm despite subdued downstream steel demand.
Domestic pig iron market adds pressure to coke sentiment
India’s pig iron market remained under pressure, with Durgapur prices declining by around INR 200/t w-o-w to INR 38,300/t ex-works. The decline reflects weak downstream steel demand and limited buying interest, which could weigh on steelmakers’ willingness to replenish coke inventories aggressively. Lower pig iron and finished-steel prices may therefore cap the upside potential for met coke, particularly if steel mills continue to operate with lean inventories and defer spot purchases.
Outlook
India’s met coke prices are expected to remain largely range-bound in the near term, with stable imported coke and expectations of post-monsoon demand recovery providing support. However, weak finished-steel demand, declining iron ore prices, subdued pig iron prices and cautious spot buying could limit upside and keep prices vulnerable to minor corrections. A sustained post-monsoon recovery in steel demand and restocking would be key to a meaningful price recovery.
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