South African Non Coking Coal import offers have remained stable at those in the week last.
Offers for the RB1 (6000 NAR) and RB2(5500 NAR) have remained at USD 81/MT and USD 71-72/MT respectively on FoB South Africa basis; for Mar’17 loadings.
Of-late, miners in that country have tried to sale their stocks to the domestic buyers therein as buyers there were willing to pay higher prices, with rising demand. This has somewhat lowered availability for exports.
South African coal prices have escalated to reasonable heights after prevailing at lows during the last year. The prices were within the USD 40-50/MT range for most parts of the last year. But, with the prices increasing in the domestic markets, miners there have tried to sale within their home country with the clear intent of making profits.
Domestic miners, like Glencore have quoted a price of USD 99/MT to the domestic customers, thus making good profits, and at the same time, tried to relieve itself from the hassles of rail transportation to ports, handling fee and port allocation while exporting coal.
Domestic Consumption:
South African power sector is undergoing changes with development in solar plants and wind power sector. However, with the growth in the coal fired plants, coal demand is expected to increase in the country.
South Africa consumed 181 MnT coal last year, with power sector accounting two-third of the total consumption. While Total coal exports were 76.87 MnT in 2016.
Coal exports have declined over the year since 2009, thus forcing coal producers to switch their attraction towards domestic market.
Indian Market Scenario:
Indian buyers’ most often major end user of South African coal are now opting for cheaper domestic coal supplied by CIL.
But with steep discount available, demand for 5500 NAR and 4800 NAR coal has gained momentum in Indian market.
5500NAR coal is offered at a discount of USD 11/MT to 6000 NAR. While low CV 4800 NAR coal is available at a discount of USD 22/MT to 6000 NAR.
At West Coast Kandla ports offers were heard at USD 90/MT, CFR for 6000 NAR coal. 5500 NAR coal is available at USD 78/MT, CFR Kandla port. Low CV 4800 NAR coal is available at USD 60/MT.
In East Coast Krishnapatnam port, 5500 coal is available at USD 74/MT, CFR. Low CV 4800 coal is offered at USD 60/MT, CFR Krishnapatnam port.
Stock and sale offers for 5500 NAR coal was heard at INR 6450/MT at Mangalore port. While low CV 4800 NAR coal is available at INR 5700/MT.
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