Australian coking coal prices have been showing an upward movement following several recent transactions concluded at higher levels on FOB basis in ex-China markets.
A 75,000t cargo of an Australian premium mid-volatile coking coal was traded on Wednesday 25th Nov at $100/t FOB Australia with a late December laycan.
Another trade was concluded yesterday at $101.50/t FOB Australia for 75,000t of an Australian premium low-volatile cargo with an early January laycan.
Despite the recent strength observed in ex-China markets, some market participants still hold conservative views towards the near-term outlook on prices.
Excess supply of spot cargoes keep prices pressurized for Asian markets outside China
Up until last week, Australian coking coal prices were continuously declining amid oversupply concerns arising from subdued buying interest in Asian markets excluding China. However, the Chinese market has been observing a sustained strong demand for non-Australian coals following the country’s informal import ban since mid-October.
Persistent oversupply concerns had been exerting tremendous downward pressure on the Australian coking coal prices with continued uncertainty over the lifting of current Chinese import restrictions on Australian coals.
Ex-Chinese buying interest for seaborne coking coal is presently limited across major markets in the Asia-Pacific region outside China despite ample material availability at steeply discounted levels.
Even as Indian end-users could benefit from the increased supply of Australian coking coal at competitive prices, most buyers are refraining from immediate procurement in hopes that offers could decline further.
Furthermore, the country’s spot demand remains moderate because there has not been any significant improvement in steel product sales that could lead to an incremental demand for imported coking coal.
India Coal Import Shipment Vessel Lineup
CoalMint’s latest vessel lineup data (as on 25th Nov’20) reveals that a total quantity of 1,644,047t of Australian coking coal is expected to reach various Indian ports by 12th Dec’20.
555,000t Dhamra (Odisha)
157,489t Gangavaram (Visakhapatnam)
231,900t Haldia (West Bengal)
200,940t Jaigarh (Maharashtra)
193,519t Krishnapatnam (Andhra Pradesh)
184,306t Mormugao (Goa)
120,893t Vizag (Andhra Pradesh)
Price Assessments
Latest prices for the Premium HCC and the 64 Mid Vol HCC grades are assessed at around $101.25/t and $92.75/t FoB Hay Point, Australia.
For Indian buyers, these prices amount to $114.65/t and $106.15/t respectively on CNF India basis.
Australia-India dry bulk freight rate is currently assessed at $13.40/t for delivery by Panamax vessel class.
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By Aditya Sinha
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