The speculation of Petcoke prices going up in India during the recent past did not eventually materialize mainly due to improvement in domestic supply lately.
MARKET TREND
In a twist to the Indian Petcoke market, domestic supply has improved recently and also import offers have declined from the recent upswings. Import offers from key international markets have retracted to the Apr’16-end levels.
According to an importer, Pet Coke (9% Sulphur) offers from Saudi Arabia have dipped to around USD 45/MT CFR India; and import offers of the material (6.5% Sulphur) from USA have declined to around USD 51/MT CFR India. These offers pertain to Jun’16 delivery.
Meanwhile, the tight supply situation prevailed in the country’s markets in the recent weeks has now eased with domestic supply improving due to production of Reliance Industries Limited (RIL) going up after restarting operations after a maintenance shut-down of a critical unit of its refinery at the Special Economic Zone in Jamanagar of Gujarat.
Domestic producers in the country seem to have refrained from revising their ex-works prices due to the improvement in supply and import offers undergoing down-turn.
It may be recalled that, on 1stMay’16, RIL, the largest producer in the country, had hiked its ex-works price by INR 500/MT to INR 4,650/MT. On that day, Essar, the country’s second largest producer, also had hiked its ex-works price by the same amount to INR 4,640/MT.
Source: Market Sources
IMPORTS
During May’16, 403,700 MT of Petcoke was imported into the country, upto the 11th of the month, according to data compiled by SteelMint Research.
Shree Cement, Ramco Cement, JK Cement and India Cement were the top importers during the period, among others.
FORECAST
Pet Coke prices are unlikely to go up significantly in the near to medium term as crude oil prices are expected to remain at lows due to over-supply.
Iran is heard to have decided not to cut its oil production as it is trying vigorously to regain its global market share, after sanctions against the country were lifted.
The scheduled meeting between the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC nations on 2nd Jun’16 to decide upon freezing oil production is thus unlikely to meet its objective without Iran’s participation. The freezing in oil production is intended to raise crude oil prices.
Leave a Reply