Coking Coal prices have fallen further as supplies from Australia were increasing after all rail lines in the Queensland region of Australia connecting coal mines to ports resumed full-fledged operations.
The latest offer for the Premium HCC is reported lower by around USD 8/MT at USD 232/MT FoB Australia. At the same time, the fresh offer for the 64 Mid Vol HCC is reported at USD 217/MT FoB Australia, down by around USD 10/MT from the previous rate.
Source: CoalMint Research
For Indian buyers, these offers translate into: USD 246/MT and USD 231/MT respectively on CFR India basis.
On the demand front, consumption of Coking Coal will increase in India as steel production is on a rising path. Recently, Tata Steel has received environmental clearance for raising its steel production at its Jamshedpur facility to 11 MnT.
In another development, the public sector steel major—Steel Authority of India Limited (SAIL)— is going to develop the Tasra coal mine at the Jharia Coalfield in Dhadbad for captive use. A proposal is learnt to have been prepared that will soon be placed before the board of directors of the steel producer.
The Tasra mine bears the potential of producing 0.3 MnT of Prime Coking Coal in the first year of production. According to the estimates, the mine will be able to produce 4 MnT of coal by the fifth year of commencing production, out of which 2 MnT of Coking Coal could be extracted after washing.
SAIL requires around 15.5 MnT of Coking Coal annually, and the requirement is estimated to go up to about 20 MnT by 2020, when the steel major will attain an annual production of 23 MnT. SAIL has to import more than 80% of its Coking Coal requirement due to domestic inadequacy.
IMPORTS
Coking Coal imports have continued to enter into India as demand is strong due to active steel making. During the 1-28Apr’17 period, around 3.7 MnT of the coal was imported into India, data compiled by CoalMint Research shows.
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